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 BOSTON, Jan. 13 /PRNewswire/ -- The Pioneer Group, Inc. (NASDAQ: PIOG), a major Boston-based financial services company, today announced the formation of Pioneer Investments, a Moscow-based joint venture between Pioneer and three Russian organizations. The joint venture will provide investment management and venture capital services on behalf of Russian and non-Russian clients. Pioneer will be the majority-owner and manager of the Russian joint stock company, which will have offices and a multinational staff in Moscow.
 "We have been exploring Russia's investment potential for some time," said John F. Cogan, Jr., Pioneer's president. "The restructuring and privatization of the Russian economy has made more progress and has gained more momentum than is generally credited in the West and sets a favorable economic backdrop for the next decade. The wide dispersion of vouchers, the creation of stock markets and the possibility for direct placements combine to create a unique opportunity for experienced investors. We have been active in the Russian environment through a resource-related joint venture in St. Petersburg and have a first-hand knowledge of the nuances of doing business in Russia."
 Pioneer manages over $11 billion in equities and fixed income for institutional and individual clients in Europe and the United States, investing in over 30 countries.
 Pioneer has already established several businesses outside the United States. With a Polish partner Pioneer set up FSL, Ltd., the first company in Poland capable of supplying accounting, data processing and other services for mutual funds. Pioneer on its own established the first mutual fund in Poland, sold to Polish citizens and invested primarily in Polish equities and bonds. Both operations have grown dramatically. Pioneer has also established a Warsaw subsidiary to manage direct equity investments in Poland for U.S. and European investors. Pioneer also has asset management ventures in India and Taiwan. "Our goal in each of these ventures is to combine Pioneer's expertise with the knowledge of local partners and employees, and to provide a real benefit to the local economy," according to David D. Tripple, Pioneer's executive vice president.
 In Moscow, Pioneer has retained Ernst & Young, an international professional services firm with 460 professionals in four offices in the CIS, as business and financial advisor. The firm will provide due diligence, investment valuation and financial reporting services, advice on the selection of targets for investments and direct access to local expertise on the myriad of accounting, tax and commercial issues that may arise for companies entering or trading in this challenging environment. "Ernst & Young Vneshconsult, based in Moscow, was selected for its skill, experience and knowledge in dealing with the Russian market place, as well as its global resources," said Mr. Cogan.
 "Since we established our first office in Moscow in 1988, Ernst & Young has been proud to play a leading role in helping to attract much-needed investment capital to organizations in Russia and other countries of the CIS," said Elwyn Eilledge, chairman of Ernst & Young International. "For The Pioneer Group, its partners, and potential investors, Ernst & Young brings an integrated services approach to navigating Russia's relatively uncharted financial and business waters."
 "Pioneer's decision coincides with Russian President Boris Yeltsin's decision to put into effect the privatization program of state and municipal enterprises in 1994," commented Alexander Roubstov, deputy managing partner of Ernst & Young Vneshconsult. "This will give foreign investors more rights to take part in Russia's privatization process. Foreign individuals and companies may bid in auctions and tenders on an equal footing with domestic investors. The private sector currently accounts for 45-50% of Russian property and the aim of the new program is to privatize 80% of the Russian economy by July 1994."
 Pioneer will be joined in this venture by The Institute of Economy in Transition and the Association of Private and Privatized Companies. Both were organized by Yegor T. Gaidar, currently serving as Russia's first deputy prime minister, as focal points of the reform process in Russia. The Institute of Economy in Transition is one of the leading academic organizations in Russia, monitoring the path of reform and developing economic forecasts for government and international institutional institutions. The Association of Private and Privatized Companies represents the interests of more than 3,000 members and has branch offices in more than 40 cities in Russia.
 Igor Kolosnitsin, director of the Institute of Economy in Transition, added, "The role of our Institute in this venture will be to provide information about basic trends in the Russian economy, about forthcoming changes in legislation and on the business climate in general."
 "The stimulation of foreign investment is essential to the success of Russia's ongoing economic transition," said Mr. Gaidar. "Through innovative projects of this nature, organizations such as Pioneer will be instrumental in fulfilling the tremendous capital needs of our newly privatized economic structure."
 The Pioneer Group, Inc. is a publicly traded company listed on the NASDAQ National Market System, symbol PIOG.
 -0- 1/13/94
 /CONTACT: Anne W. Patenaude, 617-422-4727, or Jacqueline K. Collins, 617-422-4728, both of Pioneer Group/

CO: Pioneer Group, Inc. ST: Massachusetts IN: FIN SU: JVN

LG -- NY037 -- 1794 01/13/94 11:03 EST
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Publication:PR Newswire
Date:Jan 13, 1994

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