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Russia Slams Planned Siemens Stake in Strategic Company

Category: Defence Industry

Russia’s parliament on April 8 passed almost unanimously a resolution warning the government against plans to allow German industrial giant Siemens to purchase a controlling stake in the strategic engineering company Silovye Mashiny.

“Selling a controlling share in Silovye Mashiny (Power Machines) could lead to an inability to meet the state’s military procurement orders and the spread of secrets,” the resolution in the lower house of parliament, the State Duma, said.

Nikolai Pavlov, a deputy of the nationalist Rodina party, said: “The sale of Silovye Mashiny must not be allowed.”

The vote, passed by a 377-1 vote with one abstention, came on the eve of a visit by President Vladimir Putin to Germany.

Silovye Mashiny mostly makes energy equipment, but some of its plants also produce parts for the Russian defense sector, including the nuclear fleet.

In addition to national security concerns, such a sale could prompt domestic energy price rises, the deputies warned.

Siemens and the Russian holding Interros, current owner of Silovye Mashiny, announced last July an agreement to create a joint venture that would control about 71 percent of the Russian turbine manufacturer.

The deal was announced at a meeting between Putin and German Chancellor Gerhard Schroeder, but it has yet to win an all-clear from Russia’s anti-monopoly authorities.

On Wednesday, Russia’s economic development minister, German Gref, gave his backing, saying that Siemens had promised 250 million euros ($323 million) in investments.

Agence France-Presse

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