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Russian Machines

Russian Machines is the largest Russian machine-building corporation, which unites industrial memberships in such branches as: automobile construction, the production of road-building technology and auto-components, railroad and aviation machine building, the production of special equipment for the armed forces. A total of 30 enterprises, located in different regions of Russia, enter into the composition of corporation. On the sums of work in 2007 the joint gain of corporation composed 157,964,000,000 rubles (increase on the comparison since 2006. 28%). At that time the Director-General of joint stock company "Russian Machines" was Valerie Gennadevich Lukin.

The "Military Industrial Company" [VPK] coordinates activity in the development, the production, the repair, the realization and the possible utilization of the production of military designation on Arzamasskom Machine Building Plant, plant of housings" ([g].[Vyksa]) and KHK Barnaultransmash.

The woes of Oleg Deripaska, once said to be the richest man in Russia, came as the country's stock markets suffered their most intense disorder a decade, dropping 25 per cent in just three days in mid-September 2008. This, combined with the global credit crunch, has put severe pressure on heavily indebted companies, some of which put up shares as loan security. On 03 October 2008 Magna International Inc. announced that it had been advised that the lender to a wholly-owned subsidiary of OJSC Russian Machines ("Russian Machines") had realized against the 20 million Magna Class A Subordinate Voting Shares pledged as security for the financing obtained by Russian Machines for its September 20, 2007 investment in Magna. Accordingly, Russian Machines' participation in the arrangements entered into with the Stronach Trust in connection with this investment has terminated. As a result of the termination of these arrangements, among other things up to 20 million Magna Class A Subordinate Voting Shares were disposed of at the direction of Russian Machines' lender.

Russian Machines ceased to be an indirect shareholder of M Unicar Inc., the holding company formed to hold the Magna shares of the Stronach Trust, Russian Machines and certain members of Magna's management. "Our strategic alliance with Russian Machines has assisted us in accelerating our growth in the Russian market," said Siegfried Wolf, Magna's Co-Chief Executive Officer. "We have a good working relationship with Oleg Deripaska and the Basic Element group, including Russian Machines and its controlled subsidiary, GAZ Group, Russia's second largest automotive company. We believe that the Russian market still holds significant opportunities for us and intend to continue to pursue joint opportunities with Russian Machines and GAZ, as well as other opportunities to advance our position in Russia."

In August 2008 Oleg Deripaska's unit Russian Machines stated that it does not plan to buy the Hummer brand from General Motors Corp. Russian Machines said: "Russian Machines neither received any proposals to consider acquisition of the Hummer assets, nor is strategically interested in such a deal." Earlier sources had reported that General Motors contacted Oleg Deripaska regarding a possible sale of Hummer. The sources added that the talks were only exploratory as Hummer is not officially on auction yet.

In July 2008 Russian Machines and Rosenergoatom plan to build another nuclear power plant in the town of Obninsk, located 102 kilometres southwest of Moscow. The capacity of the new nuclear power plant will be 100 megawatt. Investments in the project are estimated at $400 to $500 million dollars and both companies will set up a joint venture on an equal footing.

In June 2008 Magna International Inc. and Russian Machines are planning to launch the production of car components in Nizhny Novgorod in the mid-2008. GAZ Group on November 18, 2006 signed a memorandum on strategic partnership with the goal of arranging the production and logistics of automobile parts and components.

In October 2006, Deripaska acquired a stake in General Motors and announced that his firm would aim to eventually control at least 10%.


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Page last modified: 19-08-2019 16:29:42 ZULU