* Agreement with Mordashov’s S-Group Capital
* 1st major tour operator to enter Russian market
* To invest up to $20 million
LONDON, April 15 (Reuters) - Europe's biggest travel firm TUI Travel TT.L said on Wednesday it had finalised terms for entering the booming Russian travel market through a joint venture with Oligarch Alexei Mordashov CHMFq.L.
The company, which first announced plans to create a joint venture with the Severstal chief executive’s S-Group Capital Management last April, said it had now signed a definitive agreement to that effect.
The joint venture, which will be 51 percent owned by S-Group and 49 percent owned by TUI Travel, has agreed to acquire majority stakes in assets owned by two tour operators in Russia and Ukraine, TUI Travel said in a statement.
“TUI Travel will be the first major international tour operator with a significant presence in Russia,” said Chief Executive Peter Long.
TUI Travel said the joint venture is expected to invest up to $40 million in the region by the end of 2009.
TUI Travel’s share of the investment expected to be up to $20 million, to be paid either in cash or the value of assets contributed to the joint venture.
Reporting by Matt Scuffham
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