The Taganrog-based plant moves out of temporary administration, although it still faces a management battle at a January EGM (590 words)

Published: 12/6/2001

According to Stanislav Tolmachev, Personnel Director of Taganrog- based TAVIA, on 23rd November, the Rostov Arbitrage Court stopped the bankruptcy procedure against the aerospace plant, on the grounds that the plant had finally settled its debts with creditors. The external administration was imposed on the company in late June 2001 after a company creditor, water supplier, Vodokanal, sued for bankruptcy, so automatically leading the company to protection and a restructuring of its debts. The claim from Vodokanal was relatively small at Rb7m, given that the total indebtedness of the budget alone is believed to be around Rb200m, but the system currently allows even the most minor to force a triggering of the process. Now, it appears that the plant has cleared all but five months of wage arrears and these are expected to be settled soon. The arbitrage court also confirmed the position of contested General Director Valery Kakurkin after the disputed EGM on 27th June. Tolmachev says this ruling will allow the situation at the plant to stabilise until the next EGM, scheduled for 11th January 2002 at which control over the plant will again be contested. The election of the new management is dependent on the direction of the AO Tupolev Holding (and RAKA), which controls 44% of TAVIA. However, sources suggest that other shareholders are not happy with Tupolev's plans for the plant, which have been presented to the regional authorities. Currently, there are already 34 candidates for the 15 board positions and eight for the position of general director. There is at least some good news for TAVIA, with extension of the contract to overhaul two Tu-142s for India in 2002. Sources say that, with a price of $7m per overhaul, TAVIA should earn around $4m from the deal, with the rest going to the Rosoboronexport. However, no mention has been made of the fate of Indian A-50/A-501s which were to have been produced by the plant. St Petersburg OAO Holding Company Leninets also looks set to benefit from the Indian decision, with reports of an imminent contract for avionics and the Morskoy Zmei (Sea Dragon) anti-ship warfare system before the end of 2001: a contract that has been under negotiation for a considerable period of time. According to Anatoly Turchak, General Director of Leninets, the holding has a preliminary agreement with Rosoboronexport for the upgrade of Indian Il-38s and Tu-142s. While the Tu-142 will be overhauled at TAVIA, the Il-38 work will take place in St Petersburg, with a further five Il-38 to be potentially re-equipped before 2005. The programme will involve a complete upgrade of the aircraft including an in flight refuelling system at a reported cost of $100m. The contract, along with potential Russian Air Force orders, is believed to have provided Leninets sufficient security to embark on the planning for a new assembly plant, which Turchak says will be built between 2005-2008 at a cost of $40-45m. At TAVIA, prospects of any movement on the Tu-334 programme, in which the plant participates, are not expected before 2004. Agreements made between TANTK Beriev and the plant over production of aircraft, such as the planned Be-135, have also been put on hold, following the incorporation of Beriev within the new Sukhoi holding company. This requires new negotiations that are unlikely to be in place before the formal completion of the holding company in late spring 2002.

Article ID: 2947