19 Nov 2009 15:15

VTB issues 3 bln ruble loan to Uralvagonzavod to refinance earlier loans

MOSCOW. Nov 19 (Interfax) - VTB has issued a three-year 3 billion ruble loan to Uralvagonzavod, a major Russian heavy machinery manufacturer, to refinance VTB's loans amounting to 2.1 billion rubles that were issued earlier under government guarantees.

VTB said in a statement that the loan was issued in line with a government commission's decision to support strategic and defense enterprises implementing the state defense order and experiencing financial problems.

It was reported in late October that an economy sustainable development commission led by Russian First Deputy Prime Minister Igor Shuvalov had endorsed the extension of state guarantees worth 3.3 billion rubles to Uralvagonzavod.

Uralvagonzavod announced the extension of a 3-billion ruble loan from VTB under state guarantees back in July.

Furthermore, in addition to guarantees on loans, the company will also receive direct state assistance in the form of capital investment. The Uralvagonzavod board of directors approved an additional issue for 5 billion rubles in July.

Uralvagonzavod, a multi-industry machine building company wholly owned by the Federal Property Management Agency (Rosimushchestvo), manufactures about 100 types of products, including military hardware, road construction vehicles, all-steel open-top railcars, specialized railcars and tank cars.