OREANDA-NEWS. March 22, 2011. The State Property Fund (SPF) of Ukraine and Briansk engineering plant have signed an amicable agreement regarding the privatization of a 76% stake in the Luhanskteplovoz, the Ukraine's monopoly producer of mainline locomotives, an SPF representative announced on Mar 21. The Kyiv municipal commercial court validated the agreement which supposes that both parties drop mutual claims and penalties to each other.

Millennium Capital considers the news as POSITIVE for Luhanskteplovoz. The agreement signed means the company has ridden out high-profile lawsuits that involved a major risk of losing the Russian investor as well as a potential opportunity of getting plentiful orders from the Russian railways. Transmashholding, the managing company of Briansk engineering plant and the owner of the Ulaanbaatar Railways (Mongolia), also has arranged orders for Luhanskteplovoz from its affiliate. Orders are secured by a loan from Russia's VTB bank which provides a strong chance for Ukrainian producers to enter the lucrative Mongolian market. A contract with Mongolia railways for 35 locomotives signed in 2010 will bring the company at least USD  100mn in revenues this year.