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Thursday, October 20, 2016

Russian Shipbuilding Consolidates

August 23, 2005

According to a report on RIA Novosti, Russian shipbuilding is undergoing a round of consolidation, and the aim apparently could be a shipbuilding giant, this following the sale of a significant share packet, a popular business daily, Biznes, reported.

Biznes wrote that the IST Group's sale of 88.2% of the Baltiisky Zavod shipyard to the United Industrial Corporation meant a merger between Baltiisky Zavod and rival Severnaya Verf could happen in the long term.

One source in reported that the deal was political, to complete a military order for two destroyers for China.

The Federal Industry Agency called the deal an important stage in creating a single integrated organization in military shipbuilding. It appears the consolidation is much like that in the U.S., with two enterprises bringing together different but compatible capabilities: Baltiisky Zavod reportedly has machine-building capacities, and is designed to build big ships, while Severnaya Verf is designed to build medium-sized and small ships.

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