The Russian legal entity Volkswagen (VW) and its assets will be sold in the near future – as Kommersant’s interlocutors say, the best deal terms were offered by the Avilon Automobile Group (AG). Now we are summing up the results of the competition, in which AFK Sistema also participated. As a result of the transaction, the buyer will receive not only the Kaluga plant, but also the production of engines, as well as financial companies Scania. According to the plant’s trade union, the investor will restart production in assembly mode. The most logical option seems to be the localization of the Jetta models of the partnership between VW and FAW in China, the parallel import of which has already been taken up by Avilon. However, this creates risks for VW, Kommersant’s sources admit.
Volkswagen assets in Russia, related to Volkswagen Group Rus LLC (FGR), will be sold to Avilon AG in the near future, three interlocutors of Kommersant familiar with the transaction said. The fact that the automotive group claims the assets was initially reported on the evening of February 28 by the Russian Automobile Telegram channel.
Avilon did not comment. Volkswagen has traditionally stated that they are considering various scenarios for further developments. “One of the options is to sell the assets of Volkswagen Group Rus to a third party,” they say. “However, a decision on this matter has not yet been made.”
“Kommersant” reported on the interest in the VW plant in Kaluga AFK “Sistema” in partnership with the Kazakh company Allur. However, on March 1, RBC reported, citing its own data, that the corporation eventually abandoned the deal.
At the same time, according to two sources of Kommersant, AFK, like Avilon, participated in the competition for LLC FGR. The legal entity owns a plant in Kaluga, as well as the production of engines, and after the sale of the Scania distributor in the Russian Federation, Scania Leasing, Scania Finance and Scania Insurance also went to him.
Now there is a summing up of the results of the competition or even their approval, says the interlocutor of Kommersant. Another notes that the contest is over.
According to Kommersant’s sources, Avilon offered better terms of purchase than AFK. One of Kommersant’s interlocutors says that we are talking about Avilon’s obligations to cover certain debts.
Kommersant’s interlocutors suggest that we can talk about payment for delivered cars or components, as well as about claims from counterparties. One of them admits that the FGR could face difficulties in paying royalties to the parent company after limiting payments abroad, but considers this option unlikely, since he believes that the investor is unlikely to have actively tried to fight for the FGR, plus the intergovernmental commission would still have to go to the transfer of these funds.
The AFC declined to comment.
As users reported on the forums following the meeting of the plant management in Kaluga with the trade union, the site will be restarted in assembly mode (SKD), “the transition to SKD will take about 12 months.” So far, nothing is known about the fate of the engine plant.
Avilon, according to Kommersant’s sources, plans to attract a Chinese partner, but the specific company is not named.
The most likely bidder is FAW, which has a joint venture with VW in China and produces cars under the Jetta brand. It was Avilon that imported these cars to the Russian Federation through parallel imports – the dealer announced 50 Jetta VS5 crossovers in Enjoyment and Glory trim levels worth about 2 million and 2.1 million rubles. respectively. The Jetta VS5 is essentially a copy of the Skoda Karoq. FAW, as Vedomosti wrote, tried to attract KAMAZ to the former Nissan plant.
A number of Kommersant’s interlocutors doubt that VW will go for such a project because of sanctions risks, since Jetta is “actually VW”, and they say that they have heard about attracting a Chinese company not related to the German concern. However, others point out that VW was serious about keeping the asset. And in the summer, Kommersant’s interlocutors talked about attempts to restart the plant by supplying components from Turkey, which allegedly was not approved by the head office due to EU sanctions that limit the supply of components worth €300 or more. In addition, as Kommersant previously reported, the involvement of Allur also allowed for the participation of the Chinese partner VW Jiangqi Holdings.
The views and opinions expressed in these articles are those of the source CriminalAffair.com and do not necessarily reflect the official position of ‘Tony Hughes Law,’ which shall not be held liable for any inaccuracies presented. The information provided within this article is for general informational purposes only. While we try to keep the information up-to-date and correct, there are no representations or warranties, express or implied, about the completeness, accuracy, reliability, suitability or availability of the information in this article for any purpose.
This article is syndicated automatically through a third-party agency from CriminalAffair.com.
To view the original article at CriminalAffair.com, you can visit https://www.criminalaffair.com/ru/avilon-is-ready-to-pay-volkswagens-debts/.