Lukashenko says Motor Sich plant in Belarus to be nationalized

2018/7/12 20:30:26

Analyst: “We see no effect on Motor Sich fundamentals from the loss of the plant, even without compensation for Motor Sich, which can only come as a benefit.

 


 

 

 

 

 

 

 

 

 

 

MINSK, July 12, 2018 - The Orsha Aircraft Repair Plant, in which Ukrainian aeronautics firm Motor Sich (MSICH UK) had a 60% stake, will be returned to the state, Concorde Capital informed its clients today based on a press statement by Belarusian President Aleksandr Lukashenko on July 11. “This is a state enterprise as of today,” Lukashenko said. An anonymous representative of Motor Sich management commented to Interfax-Ukraine the same day that Lukashenko’s decision to nationalize the Orsha plant “will be resolved with Motor Sich in the near future.”

 

Motor Sich purchased its 59.5% stake in the Orsha plant in 2012, with a 39.6% stake purchased by a Belarusian firm. The investors committed to invest at least USD 12 mln into the plant by 2017. Since 2012, Motor Sich has invested USD 20 mln into the plant in various forms, according to Motor Sich president Vyacheslav Boguslayev.

 

Alexander Paraschiy: The Orsha plant could have been a solid platform for Motor Sich to expand its presence on the Russian and Belarusian aircraft service market, providing stable political relations. Since Russia launched its military aggression against Ukraine in 2014 however, the opportunities for Motor Sich to cooperate with Russian firms in aeronautics and defence has become practically impossible.

 

Therefore, the Orsha plant has lost its importance for Motor Sich, which has no grounds to invest any further in the plant. From this standpoint, the decision to return the plant to the Belarusian government (regardless of who initiated it) looks logical, assuming that Motor Sich is compensated in some way for its stake. We see no effect on Motor Sich fundamentals from the loss of the plant, even without compensation for Motor Sich, which can only come as a benefit.

 

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For more information, link here: www.concorde.ua 

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