OREANDA-NEWS. December 10, 2007. Alexander Yaroslavskiy, the co-owner of UkrSibbank, has got rid of Kharkov Tractors OJSC by selling 62% of shares (Profmash SM LLC – 49.8%, Ukraine Trading LLC – 8.592%, Nezavisimost LLC – 5.755%) to the co-owner of Base Element (BazEl) – Oleg Deripaska, UFC-Capital informs. The deal will be finalized at the end of January 2008 after Kharkov Tractors increases its statutory capital to UAH 200 mn. The shareholders’ meeting, scheduled for January 22, 2008, will consider the company’s statutory capital increase almost 46 times – to UAH 200 mn – by private offering of additionally issued shares. According to the official version, the statutory capital will be increased to settle the accounts payable of the company. However, one should bear in mind, that on the same day in Cherkassy there will be one more meeting of Kharkov Tractors shareholders convened by a shareholder that in the aggregate holds a 10% stake in the company. Apparently, the statutory capital is to be increased in order to dilute a 27% stake purchased by three Ukrainian investment companies.  

On November 23, the State Property Fund of Ukraine sold 27.6% of Kharkov Tractors on the Ukrainian Interbank Foreign Exchange for UAH 14.032 million. The buyers were the Kiev-based investment companies: Dragon Capital, Briz 2007, and Private Investment Company. With par value of UAH 0.25 a share the buyers paid UAH 2.9 a share. At that time everybody asserted that the block of shares were sold at underestimated price, as at that moment the shares quotations amounted to UAH 4. To all appearances, the investment companies just wanted to earn on the forthcoming sale of Kharkov Tractors. Now, it becomes clear that nobody will overpay for the stake and it will be simply diluted. And it will be diluted rather trivially: to preserve their stake these three companies will have to pay about UAH 35 million in the aggregate. However, it is not excluded that the new owner increases the statutory capital apprehending a re-privatization.  

Alexander Yaroslavskiy does not need Kharkov Tractors, as the latter is in a very lamentable state now. The tractors produced by the company are morally obsolete. As a result, against the net income amounting to UAH 369 mn, the losses in 2006 reached a record amount of UAH 31.229 mn. The company requires multi-million investments, which this oligarch from Kharkov is not inclined to make, as he has made up his mind to focus on real estate market and chemical industry. However, for Oleg Deripaska Kharkov Tractors will be a very relevant acquisition. Spetstechnika division of his GAZ Group integrates five factories in the Russian Federation that produce road-building machinery and participates in a multi-billion Russian federal program on road construction. In 2006, this division generated an income amounting to $250 mn, and some of its entities’ capacities were loaded by 100%. By 2011, the turnover of Spetstechnika is expected to be increased to $1 bn, which will be impossible without acquisition of new capacities. Since this summer the top managers of GAZ Group have been working at Kharkov Tractors. Among them are Sergei Grulev, the finance director of Spetstechnika division, and Nikolai Rudenko, the director for production system development of Ural automotive factory. Victor Sobolev and Evgeniy Mazur, who work in various GAZ structural units, were also introduced into the management team of the company. Alexander Kosov, chief executive of Ulianovsk Motors, became a top-manager of Kharkov Tractors.