Spetsenergotrans sells Orsk Railcar Plant to Railtransholding - paper
MOSCOW. Oct 7 (Interfax) - Spetsenergotrans (SET), which is controlled by Ziyad Manasir, has sold the Orsk Railcar Plant (OVZ) to Sergei Shpak's Railtransholding (RTH), national daily Kommersant reported on Tuesday, citing several sources on the Russian transport market. Both parties confirmed the report.
Shpak said the deal was closed in September, but the physical transfer of the shares has not taken place yet. The paper reported one source familiar with the negotiations as saying that the purchase-sale contract has been signed, and "all the formalities will be settled soon."
The parameters of the deal have not been disclosed, but a Kommersant sources said that "there was some cash for the asset" despite the plant's heavy debt.
The sale was motivated by the current situation on the railway market and the condition of OVZ. "The condition of the asset itself and of the market served as the reason behind the sale," a SET representative told Interfax. The representative did not disclose the size of the deal, noting only that SET no longer had any liabilities towards OVZ's main creditor, Vnesheconombank.
RTH operates about 25,000 freight cars (primarily gondola cars), and the group also owns the Novozybkov Engineering Plant, with capacity for up to 10,000 railcars per year, and the Bryansk Railcar Repair Depot. The group does not disclose its financial results.
In 2013 RTH bought leasing company 3R with a fleet of 5,500 railcars, and in April 2014 it was reported that the group was discussing a possible merger with UVZ-Logistic, which is 50% owned by state engineering company Uralvagonzavod (UVZ).
SET controlled OVZ for little more than a year, having bought it from a company controlled by Oleg Kovalev in April 2013. But the actual seller was state development bank VEB, to which the plant owed about 4.6 billion rubles. It was expected that within two years SET would establish assembly of up to 5,000 railcars annually at the plant and handle their maintenance (8,000 depot repairs and 2,000 major repairs per year). But SET did not manage to reach an agreement with VEB to restructure the loan and by September OVZ had only produced 400 universal flatcars and repaired about 2,000 railcars.
Manasir decided to dispose of the plant due to difficulties servicing the debt, the paper reported one source as saying. Virtually nothing has changed at OVZ in the past year - not a single production process was fine-tuned, although 600 plant employees received wages, the Kommersant source said.
The paper reported another source as saying that, after selling his main asset Stroygazconsulting (SGC) to companies controlled by Ruslan Baisarov, Manasir began to think about also selling transport assets that mainly served SGC. OVZ was deemed a noncore asset, but the tycoon might also sell SET, the paper's source said.
Meanwhile, a week ago, already after the deal with RTH was closed, external administration was imposed at OVZ. This was preceded by litigation initiated in 2013 by Orenburg-based LLC Gazpromdorstroy, which demanded that OVZ be declared bankrupt over a debt of 39 million rubles.
At the request of VEB, Alexander Prokhorov of the non-commercial partnership Interregional Center of Experts and Professional Managers was appointed temporary administrator, the paper reported Shpak as saying. He added that RTH is holding negotiations with the bank, Prokhorov and the Orenburg Region to get the plant out of bankruptcy in order to avoid receivership.
VEB declined to comment other than to say that "right now there is no decision on imposing receivership," the paper reported. The Orenburg regional administration did not respond to questions, the paper said.
Shpak said RTH is prepared to invest "a certain sum in the development of OVZ," but the company is also counting on borrowed funds. He said the plant could break even in a year at the earliest.