The Russian Technologies state corporation, a minority shareholder of Avtodiesel (Yaroslavl Diesel Engine Plant), is blocking the plant's planned 5.8 billion rouble loan agreement with VEB. The plant expected to use the loan for a new truck engine project.
The general shareholder meeting of Avtodiesel, which is part of Russia's GAZ Group, planned to approve a major deal on December 21: a 5.8 billion rouble ten-year loan agreement with Vnesheconombank (VEB) for a new engine project, the 4.43-6.45 litre YaMZ-530 diesel.
However, the plan was voted down by Yuri Shagin, head of the Russian Technologies branch in the Yaroslavl Region, according to Yelena Matveyeva, deputy head of the GAZ board of directors. He did not cite any reasons for his decision but said he had been given an oral instruction on how to vote for the 31% stake, she told Vedomosti daily.
It took GAZ several years to design the new engine in partnership with Austrian AVL. In 2008, the group began the construction of a plant to assemble the engines and ordered the required equipment. The first production line to be installed at the new facility was to roll out 40,000-50,000 engines a year. GAZ applied to VEB for financing in October 2009, initially requesting 10 billion roubles; Prime Minister Vladimir Putin called for support of the plant during his December trip to Yaroslavl.
However, the consideration of the group's request was not prompt, nor smooth. At first, VEB demanded that GAZ coordinate the project with its partner, Russian Technologies, then took a long time choosing between Avtodiesel's project and a truck project developed by Kamaz and Cummins. After some hesitation, Russian Technologies eventually agreed to the Avtodiesel project, according to sources in the state corporation and GAZ.
In October, the VEB supervisory board, chaired by Vladimir Putin, approved a 5.8 billion rouble loan to Avtodiesel.
"It appears that there is no accord among the management of Russian Technologies, and the decisions it makes are in conflict with VEB's decisions. It's amazing that a state corporation established to promote innovative technologies should itself be inhibiting them," said Matveyeva, outraged.
The Russian Technologies representative declined to comment on why the corporation's management changed its mind. A source close to the corporation said the problem could have been that Russian Technologies was expected to provide a block of shares to secure the loan (and GAZ was to do the same), while the project's prospects were vague. But the state corporation is willing to discuss the situation with GAZ, the source added.
Yelena Sakhnova, a VTB Capital analyst, believes there is a different reason: Kamaz, which is 37% owned by Russian Technologies, initiated its project in late November, so the state corporation was reluctant to see Oleg Deripaska's company rival it.
Matveyeva hopes the state corporation will change its mind again and approve the loan at the next GAZ shareholder meeting.
A VEB representative declined to comment. Putin's spokesman Dmitry Peskov is confident that the state corporation will not jeopardize the plant's investment programme. According to his information, the terms stipulated for the loan did not comply with the state corporation's practices.
Maxim Tovkailo, Yulia Fedorinova