21 Feb 2023 18:49

Putin allows purchase of American Emerson's Russian business by local management

CHELYABINSK. Feb 21 (Interfax) - Russian President Vladimir Putin has authorized Metran Holding LLC in Chelyabinsk to acquire shares of Metran Industrial Group, the Russian manufacturer of technological process automation equipment, from companies belonging to Emerson Electric Co., the American engineering company.

The president's order was published on the federal portal of regulatory legal acts.

According to the order, Metran Holding is authorized to buy 178 ordinary shares of the Chelyabinsk joint-stock company from Tranmet Holdings B.V., based in the Netherlands, and part of Emerson Electric Co., and one more of its ordinary shares, held by Tranmet Holdings Ltd., Great Britain, also part of Emerson Electric Co.

In addition, the president allowed Metran Holding to buy 100% of the charter capital of Emerson LLC, based in Moscow, which is engaged in the trade and maintenance of electrical equipment, from another Emerson Electric company. The seller of the shares will be Emerson Electric Niderland B.V. based in the Netherlands.

In September 2022, Emerson announced that it intends to sell its business in Russia, including Metran Industrial Group and Emerson LLC, to local management.

According to the Unified State Register of Legal Entities, Metran Holding LLC was registered in August 2022, with a principle activity of advising on commercial activities and management. The charter capital of the company is 10 thousand rubles. Metran Holding is owned in equal shares by Anton Druzhinin, General Director of Metran Industrial Group, and Nikolay Shestakov, General Director of Emerson LLC.

Metran IG, according to the company's report, earned 1.306 billion rubles of net profit for 2021 compared with 357.25 million in 2020, on revenue of 6.472 billion rubles, and 5.566 billion rubles the prior year. The company has a separate subdivision in St. Petersburg, representative offices in the Irkutsk region and Perm territory, as well as a Chelyabinsk subsidiary, Metran-Export.

The revenue of Emerson LLC in 2021 was 9.8 billion rubles compared to 10.4 billion rubles in 2020; net profit was 241.1 million rubles in 2021 vs. 592.2 million rubles in 2020.

Emerson previously wrote off $162 million in connection with an exit from Russian assets announced in May 2022. "Historically, Emerson's sales in Russia have been primarily in the Automation Solutions segment and accounted for approximately 1.5% of annual revenue. In the third quarter of fiscal year 2022, the company recognized a pre-tax loss of $162 million associated with the termination of operations in Russia," the corporation's report said.

Emerson Electric Co. became the sole owner of Metran Industrial Group in 2009. In 2015, the company opened an office and $40 million production complex in Chelyabinsk and announced its intention to build a second stage. Metran IG moved to the new site along with production lines.

In 2016, a production line was put into operation at the plant in Chelyabinsk, which made it possible to localize the production of ControlWave Micro measuring controllers in Russia. In 2018, the production of Coriolis flow meters and solenoid valves was launched.