Sistema might buy VW plant in Russia, reopen it with Kazakhstan's Allur - paper
MOSCOW. Feb 6 (Interfax) - Investment group Sistema PJSFC is interested in buying the shuttered Russian plant of Volkswagen, Volkswagen Group Rus LLC, and might reopen it with the help of Kazakh automaker Allur and restart production of the German automaker's models, national daily Kommersant reported on Monday.
The paper reported several sources as saying that Sistema is in negotiations to acquire VW's plant in Kaluga. They said Sistema planned to partner on the project with Allur, which includes the Agromashholding and SaryarkaAvtoProm plants and AllurAuto dealership and distribution network.
Sistema and Allur declined to comment. The Russian subsidiary of VW said that the company is monitoring the situation and considering various scenarios, including the sale of assets to a third party, the paper reported. However, a final decision has not been made on this, the company said.
German newspaper Frankfurter Allgemeine Zeitung, citing sources, reported in October 2022 that VW expected to find a buyer for the plant in Russia or China.
Allur has Chinese shareholders, Kommersant said. The group's principal owner in 2020, with 51%, was C&J Ned Auto B.V., which is co-owned by China National Machinery Import & Export Co., Ltd and Anhui Jiangqi Investment Co., Ltd. The latter owns a company through which Chinese automaker JAC works in Russia. Jiangqi Holdings works with VW in China.
Allur chairman Andrei Lavrentyev owns 27.48% of the group, Yury Tskhai owns 16.52% and the state-owned Development Bank of Kazakhstan holds 5%. JSC Allur Group did not publish financial statements for 2021.
Kazakhstan reported two sources as saying that the arrangement under which the Kazakh and Russian companies might cooperate on the transaction has not been determined, but there are several options. They said it will involve continuing production of existing models.
Sistema plans to use the acquisition to create a machine-building holding company, the paper reported one source as saying. This holding company does not have any assets at the moment, but in the 2000s Sistema had a joint venture to assemble Volvo trucks in Zelenograd
The paper reported another source as saying that investors from the Middle East and China are also interested in possibly acquiring the plant and restarting production of VWs or similar models. This source has not heard about Sistema's involvement.
Kommersant's sources said VW tried to restart the Russian plant itself by shipping components from Turkey, but this never happened as the headquarters of European automakers prohibited such schemes due to fears that they might be seen as circumvention of European Union sanctions, which restrict shipment of components worth over 300 euros to Russia.
The Volkswagen Group Rus plant, which has capacity to produce 225,000 automobiles per year, is located in the Grabtsevo industrial park in Kaluga. Until early spring of 2022, the plant produced Volkswagen Polo, Volkswagen Tiguan and Skoda Rapid cars. The company also operated a gasoline engine plant in Kaluga with capacity to produce 150,000 engines per year.
VW announced in early March 2022 that it would shut down automobile production in Russia.
VW also had contract assembly at GAZ facilities in Nizhny Novgorod from 2012 that produced the Skoda Octavia, Skoda Karoq, Skoda Kodiaq and Volkswagen Taos until the spring of 2022. Assembly shut down last summer and VW announced the closure of its Nizhny Novgorod office.