Machinery

The State Property Fund of Ukraine presented Bryansk Machine Building Plant (a member of Transmashholding, Russia) with an offer to terminate their contract on acquisition of 76% share in Luganskteplovoz [LTPL UZ] by agreement between the parties. Bryansk Machine Building Plant was supposed to pay 100% of the share price by August 31 2010, which did not happen. Now the company will have 20 days to terminate the contract or to pay the full contract price, including the competition pledge and fines, at an overall cost of USD 15.7mln.

In July 2010, export of steel pipes from Ukraine decreased by 12.1% MoM to 95thsd. Ton. Revenues from exports fell by 16.5% to USD 100.4 mln. Import of steel pipes has decreased by 18.8% to 3.5 thsd. Ton, while expenses on imports increased by 16.7% to USD 7.6mln. In January-July 2010, export of steel pipes fell by 16.9% to 652 thsd ton, while overall earnings from export accounted 657 mln. During this period, import of steel pipes increased by 31.4% to 29.9thsd Ton, with a total cost of USD 54.3 mln.

According to Dmitry Kiva, the general director of Antonov State Aircraft Company, recent negotiations with Russian Joint Aircraft Corporation may result in creation of joint Russia-Ukrainian aviation concern by November. Meanwhile Antonov announced its plans to attract USD 0.5 bln of credits, backed by contract receivables during the next 3 years for expending production volume.

In August 2010, Kryukivka Carriage [KVBZ UZ] will have decreased its train car production by 4% MoM to 873 units. All 3 sections of the plant were operating during the month, producing 50 cement carriers, 2 subway train carriages, and 821 gondola cars.

Bogdan Corporation, owner of Bogdan Motors [LUAZ UZ], has announced its plan to increase car production at the Cherkassy plant to 5,000 units per month by the year 2015. Next year, the company aims to produce 2,500 – 3,000 cars per month. From 2012 - 2015, Bogdan Motors will incrementally increase production to reach 5,000 units per month by 2015, which is the car production breakeven point for the plant.

Turboatom [TATM UZ] has finished modernization of a steam turbine for module 10 of Lugansk thermal generating plant. The last part of equipment for modernization is to be supplied today. The supply will finish the contract between Turboatom and Lugansk thermal generating plant concluded October 29, 2008 with overall cost of USD 8.2 mln.

Transmashholding (Russia) (owner of 76% share of Luganskteplovoz [LTPL UZ]) plans to provide Luganskteplovoz with a large order for 100 locomotive sections for RZD (Russian Railway Company) and 50 - for Ulan-Bator Railway (Russia-Mongolia railway operator) in 2011. The company also plans to construct two new generation locomotives.

New long trolleybus produced by Bogdan Corporation (proprietor of Bogdan Motors [LUAZ UA]) in cooperation Cegelec (Czech Republic) was certified in accordance with standards of the EU. According to the company press secretary, this will allow Bogdan Motors to participate in trolleybus supply tenders in the European Union, starting from tenders in Lithuania in 2010.

Ukrainian Machine Building Holding (Cyprus), member of SCM Group has consolidated 50.05% share of Donetskgirmash [DGRM UZ].

According to Viktor Chyornyi, the deputy general director of Ukrzaliznytsya, the company experiences deficit of rolling stock due to the cropping campaign and preparation to the heating season which requires coal transportation increase. Total amount of cargo freight car deficit is estimated at 2,000 units, which administration plans to purchase by the end of 2010.