TagAZ ready for assembly negotiations with Fiat, Rostov govt ready to help with carmaker's debt problems
ROSTOV ON THE DON. Mar 3 (Interfax) - LLC Taganrog Automobile Plant (TagAZ) is not in negotiations with Italy's Fiat SpA for car assembly in Russia, Mikhail Paramonov, the Russian enterprise's board chairman, told journalists on Thursday.
"The rumors about Fiat are untrue. There haven't been any negotiations with them. There have only been rumors that Fiat wants to hold negotiations. If Fiat wants this we will carry them out. But again, the main thing is total production and not the number of partners we have. Basically we don't need that many," he said.
Sources earlier said that TagAZ has been in discusses with Fiat in regards to partnership fro the industrial assembly of cars. However, it remained unclear what stage of the negotiation process had been reached.
Fiat said at the end of February that it had submitted an application with Russia's Economic Development for starting up assembly production in Russia. The company hopes to produce up to 300,000 cars a year in Russia.
Rostov Governor Vasily Golubev told journalists during a visit to TagAZ that the regional government was ready to assist the plant restructure its loan debt owed to VTB .
"We will look for ways of supporting the enterprise. This would be, on one hand, support on the administrative level such as purchase of transport. Also several issues require a decision on the federal level, this is the company's relationship with bank," he said.
Golubev said that after the plant's management had come to the administration, he gave instructed to prepare a decision on solving TagAZ's problems.
"Negotiations with VTB are planned along with other banks, which are now supporting the enterprise. I think there is a possibility for us to work and make sure that those plans that are already in place can been implemented," he said.
TagAZ said in its materials that VTB is ready to look into restructuring the company's loan debt on the condition that 30% of this amount is paid in a single transaction. However, such a condition is unacceptable.
TagAZ's materials said that these terms would cause breaches of already signed agreements with other banks, as well as its stoppage of production.
VTB is sole the bank that TagAZ has been unable to reach an agreement for debt restructuring (5.8 billion rubles in debt). The carmaker has made a proposal for restructuring.
It was earlier reported that VTB had made several claims against TagAZ in the Arbitrage Court of Moscow, one of which was transferred to the Rostov Arbitrage Court at the start of September 2010.
TagAZ went to its bank creditors with a request for restructuring its debt.
TagAZ's debt before its 12 bank creditors, including Sberbank, VTB and Gazprombank, which comes to around 21 billion rubles.