Deal to Transfer Shares of Kalashnikov to Private Investors Secured
OREANDA-NEWS. Private investors Alexey Krivoruchko and Andrei Bokarev closed a deal to acquire a 49% stake in the Kalashnikov Concern. Rostec has retained its controlling stake.
The deal is valued at RUB 1.3 billion. Upon completion of the necessary business procedures the shareholder capital of the Russian arms manufacture will increase to RUB 2,653,100,000.
The decision to transfer 49% of shares in the Russia's largest arms manufacturer to private investors Alexey Krivoruchko, who has taken over as General Director of Kalashnikov, and Andrei Bokarev, co-owner of Transmashholding, was made in the fall of 2013.
"The deal is a significant step in implementing Kalashnikov's financial recovery strategy that will grow the concern's capitalization and profitability. Private-public partnerships will allow for implementing large-scale projects in the near future to modernize production and increase sales volume and growth into new markets," CEO Alexey Krivoruchko noted.
An additional 2.653 billion shares of Kalashnikov with a par value of RUB 1,000 each have been issued in order to complete the deal. The Bank of Russia registered the procedure in March 2014. The additional shares have been issued under a closed subscription in favor of Rostec and the company controlled by Krivoruchko and Bokarev, TransKomplektHolding.
The government as represented by Rostec has retained a controlling stake in the concern (51%), which will help to maintain a balance of commercial and public interests in the enterprise.
Some of the funds received from the issue of additional shares will be used to repay Kalashnikov's debt obligations to Sberbank. They will also be used to carry out other measures under the company's financial recovery program.
THE KALASHNIKOV CONCERN (PREVIOUSLY NPO IZHMASH) is a major Russian manufacturer of military automatic weapons and sniper rifles, guided artillery shells, as well as a wide range of products for civilians, including shotguns, sporting rifles, machine and other tools. The enterprise was founded in 1807. It is a subsidiary of the state corporation Rostec. Kalashnikov unites major public enterprises in the Russian small arms industry (NPO Izhmash and OJSC Izhevsk Mechanical Plant). In the future the concern will acquire the Vyatskie-Polyansky Engineering Plant Molot, Koshkin Automatic Lines Design Bureau and RDTI Progress. Products are exported to 27 countries around the world, including the USA, UK, Germany, Norway, Italy, Canada, Kazakhstan and Thailand.