Helicopter plant not planning to dilute foreign shareholders, but is planning to to take them below 25%

Published: 9/20/1999

According to reports Progress, Arsenyev, has announced that it does not plan to dilute the level of foreign ownership in shareholders' equity through issuing further stock in response to the possibility that foreign ownership may have exceeded the government's 25% level. An earlier report had suggested that the share of the Progress stock located abroad had reached a level when the state is entitled to ban the production of military products (the Russian government limits foreign ownership in defence plants to 25%). Local media had reported that Vladivostok based Radiopribor, one of the main shareholders in Progress, had agreed to buy out a portion of the foreign companies' stock. It is rumoured that Radiopribor wants to increase its votes on the board of Progress and then directly influence the placement of orders. Top management of both companies denied any purchase of stock by Radiopribor, as well as any plans to issue new stock. It would seem that the helicopter manufacturer is trying to find out a way out of the present situation by locating an investor, who could purchase the stock and restore 75% Russian ownership.

Article ID: 882