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UEC to raise USD 1.9bn
Posted on Thursday, 18 May 2017 11:45
Obyedinennaya Dvigatelestroitelnaya Korporatsiya, a Russian turbine engine manufacturer also known as United Engine Corporation (UEC), has signed off on an equity dilution worth RUB 106.49 billion (USD 1.88 billion).
The Moscow-based vertically-integrated company is issuing 15.00 million shares at RUB 7,099 apiece, or 54.3 per cent of its post-sale capital, to Federal Agency for State Property Management and Rostec but no further information is known.
UEC designs, makes and services gas turbine engines for customers involved in the oil and gas, power generation, civil and defence aerospace, as well as marine and railway sectors, such as Gazprom, United Aircraft and Rosneft.
Headed by Alexander Artyukhov, the company is a wholly-owned subsidiary of Oboronprom, a part of Rostec, which was formed 2007 to promote the development, production and export of high-tech industrial products.
As an umbrella enterprise, the group has over 700 organisations that are currently part of 14 holding companies, nine of which operate in the armed services-industrial segment and five in the civilian sector, and includes 22 directly managed entities.
The portfolio contains well-known brands such as AvtoVAZ, KAMAZ, Concern Kalashnikov, Russian Helicopters and VSMPO-AVISMA.
After completing the consolidation of disparate industrial assets in 2014, Rostec now has entered a stage of active development.
The programme consists of growth, markets, operational efficiency, partnerships, and strategic and corporate initiatives and includes injecting over RUB 4,300 billion into its businesses until 2025.
It is not yet known how UEC will use proceeds from the capital increase, which is the largest announced by a Russian company in 2017 to date, according to Zephyr, the M&A database published by Bureau van Dijk.
However, last month plans emerged regarding the manufacturer upgrading production facilities through 2025 to build PD-14 engines to power Irkuk’s MC-21 aircraft.
© Zephus Ltd