New Rostec unit KUVZ acquires 9.33% of United Wagon Co
MOSCOW. Jan 10 (Interfax) - JSC Kontsern UralVagonZavod (Kontsern UVZ, KUVZ) has acquired a 9.33% stake in PJSC United Wagon Company (UWC) (MOEX: UWGN), the latter said in a statement.
The deal was registered on December 29.
According to SPARK-Interfax, KUVZ is a wholly owned subsidiary of the state Roctec corporation. It was registered in Moscow in April 2018 and its main activity is "head office business." The company does not yet have any assets. Anatoly Potapov, the head of JSC UralVagonZavod Research and Production Corporation, is the general director of KUVZ.
It emerged in the middle of December that divisions of Rostec would buy ICT Group's stake in UWC.
According to UWC's website, ICT Group Ltd, which is owned by Alexander Nesis and his partners, has a 9.5% stake in the railcar maker. A spokesman for ICT confirmed the plans to sell the group's stake, but said that the stake in question is 9.33%.
Rostec, in turn, said its management board approved the deal and its structure this week. Rostec will provide the money for the acquisition in the form of a special-purpose loan. The actual buyer will be a subsidiary of Rostec-controlled tank and railcar maker Uralvagonzavod (UVZ), Omskvagonmash.
The signing of legally binding documents with ICT is expected to take place before the end of the week, and settlements on the deal will be made in January.
The deal will strengthen UVZ's competencies in production of rolling stock and is consistent with Rostec's strategy, which calls for increasing the share of civilian products in overall production to 50% by 2025, Rostec said in a statement.
"Railcar manufacturing is a key area for us. Uralvagonzavod produced more than 15,000 freight cars in 2017, two times more than a year earlier. In 2018, we are continuing to increase volumes and plan to deliver more than 18,000. Strengthening Rostec's positions in this field requires additional competencies from other market participants. The corporation's intention to acquire equity in UWC is motivated by this," Rostec deputy head Dmitry Lelikov was quoted as saying in the press release.
National daily Kommersant reported an ICT representative as saying that the deal is an "element of the group's strategy."
The group "creates a business from scratch, develops it and then monetizes, selling either to a strategic investor or on the international market," the ICT representative said.
ICT now plans to focus on a new project in mining and processing of rare earth metals - the development of the Tomtorskoye deposit in Yakutia, which is being carried out by Triarc Mining. ICT owns 50% plus one share in Triarc and Rostec holds 25% plus one share.