Sistema Buys Out Majority Stake in Kvant
AFK Sistema’s KNTs research center bought out from IVK 53 percent in Kvant electronics plant (Zelenograd). The deal ended one of the longest confrontations in Russia’s IT-industry. The experts don’t rate the above purchase as advantageous; Russia is one of the worst places in the world to assemble electronic devices.
Kvant plant (Zelenograd, the Moscow Region) was one of the most capital-intensive projects in Soviet electronics industry with around $100 million invested from 1987 to 1992. Its capacity allows to annually produce up to one million units of finished product. Last year, the plant assembled around 25,000 monitors, first of all, of Sitronics and Rolsen brands, and 30,000-40,000 Fujitsu Siemens computers. In view of the above, the market players say Kvant turnover exceeded $1 million in 2004.
But recently Kvant has been spoken about not as a manufacturer but as an apple of discord between AFK Sistema (holder of 77.5 percent in KNTs) and IVK, one of the major system integrators of Russia with law enforcement departments as its permanent clients. Starting from late 1990s and till recently, various courts of Russia had been holding trials to determine the owner of 35 percent in Kvant, which changed hands several times.
Now, it appears that the conflict around Kvant has been settled. KNTs bought out from IVK its stake in Kvant, i.e. 53 percent, to widen Sistema's holding to 90 percent. The remaining stocks are split among Kvant minors.
Yesterday, IVK head Grigory Sizonenko confirmed the deal, declining to disclose its value. A source close to negotiations told Kommersant on condition of anonymity that the stocks were sold for $5-10 million.
KNTs declined to comment about the deal terms yesterday but the company's head Alexander Goncharuk unveiled the plans related to Kvant. Kvant will be consolidated with other electronic assets, to be more precise, with two electronic works of KNTs in Zelenograd.
In Russia, the assembly business of Kvant capacity will hardly meet expectations, PC experts say. “Efficiency of such business is rather small – from 10 percent to 15 percent. Sistema, which runs telecom assets, has got used to higher efficiency,” head of a PC firm told Kommersant. “No secret, it is much more profitable not to assembly household devices in Russia, but to import them,” he pointed out.
www.kommersant.com
All the Article in Russian as of Apr. 05, 2005
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