In Belarus right now taking Ukrainian businessman, MP, one of the key owners of the company of Zaporozhye Motor Sich Vyacheslav Bohuslayev says his ambitious project Orsha aircraft repair plant.
And in Ukraine Boguslaev may lose and the parent company, writes Denis Lavnikevich in No. 13 of the Magazine Reporter.
The President of PJSC Motor Sich, General designer and the Deputy (as stated on his personal website), Vyacheslav Boguslayev not particularly favor in Kiev — the shares of his company at the end of April 2018 was arrested. Probably the most poignant moment in the biography of the well-known Builder and politician. In addition to that Boguslayev known as the President of the only Ukrainian aircraft enterprises many times he was elected to Parliament in his homeland in the electoral district No. 77. Only if he is a member of the parliamentary group of the will of the people, in the previous convocation of the Verkhovna Rada he was a member of the faction of Party of regions.
And if in 2012-2014 he was a member of the Verkhovna Rada Committee on industrial policy, in the current convocation member of the Committee on national security and defence.
CUSTODY, UNDER ARREST
April 20, Shevchenkovskiy district court at the request of the investigator of SBU seized the company’s shares are included in the accounts in Depository institutions JV dragon Capital PJSC OTP Bank. Shareholders, whose shares were arrested, several companies registered in Panama, the British virgin Islands and Cyprus, as well as… a citizen of China.
In the petition, the SBU mentioned actions, from which the hair stand on end: that in the period from 2016 to the present time, unidentified persons from among the current and former officers, and ultimate beneficial owners of PJSC Motor Sich, acting by prior conspiracy, with the aim of weakening the state by destruction of the specified enterprise as an object with important economic and defensive value (the only enterprise in Ukraine on manufacture of civil and military aircraft engines), has undertaken a number of transactions for the purchase and sale of a controlling stake in PJSC in favour of the foreign companies Business House Helena, AG (Panama), Enfields Trade & Capital Corp. (Panama), Waldo Trade Ltd. (Virgin Islands), Granum Corporation (Panama), Skyrizon Aircraft Holdings Limited (virgin Islands), Likatron Enterprises Limited (Cyprus), Ventalina Management Ltd (Nevis), which reportedly intends to move its assets and production capacity outside of Ukraine, which will lead to its elimination and destruction. That’s it, no more and no less.
As of mid-July of 2018, the decision to arrest the shares remained in effect, and the result, obviously, continued. In the media before this episode had a lot of posts mentioned next to the name of a famous manufacturer of aircraft engines “Chinese”, “Russian”, “Belarusian” trail.
THE TRIP TO THE NORTH
The production facility in Belarus was conceived long before the events of 2014, after which the company Motor Sich were forbidden to cooperate with the Russian military clients within the framework of sanctions against the aggressor country. In 2011 Motor Sich acquired the state-owned controlling stake in Orsha aircraft repair plant (Belarus). On the basis of this company was established to repair and upgrade the popular in the post-Soviet space helicopter models, and then producing their own, very successful helicopter.
Then the Belarusian-Ukrainian company focused mainly on the Russian market. And when in 2014, the Russian Federation initiated the war in the Donbas, Belarusian business Boguslayev has sharply declined. The flow of orders from Russia instantly exhausted, and the orders received from the Belarusian army, was much less profitable and more troublesome.
Say that Motor Sich expected to participate in the creation of new weapons for the Armed forces of Belarus. However, attempts Boguslayev to participate in the creation of the Belarusian cruise missiles caused discontent in Moscow — as well as the issue in Orsha modern version of the Mi-8 helicopter.
In Kiev were dissatisfied with the desire Boguslayev through the company in Orsha to resume work on the Russian market in circumvention of the Ukrainian sanctions. On the official Minsk started to press in equal measure to Moscow and Kiev — with the same demand to cease cooperation with the company Motor Sich. As a result, Belarusian authorities offered Boguslaev “to disperse on-good”: the return of the stock plant to the state property and deal with the losses incurred.
Almost exactly four years ago, on a hot and Sunny July day 2014 in Minsk was especially crowded on the outskirts of town, near the exhibition complex Minsk-arena. There was held the international exhibition of arms and military equipment MILEX-2014. Near the entrance, in the open area, stood a huge, sparkling in the sun with white and chrome detailing helicopter Mi-8MSB. Around it went, and “obscene admired” the Russian military with the epaulets of a Colonel.
“Ukrainians, b…b, bitch! Bastards! Rats! And Belarusians, b…b, a good, traitors! To kill all these Bulbash with tufts should b…s!” — came from the Colonel.
At first, who witnessed the scene, the writer did not understand the reasons for the anger of Russians. It became clear later: in Russia used to be considered a Mi-8 helicopter and its proud to be in the class of heavy twin-engined machines is the most popular helicopter in the world.
However, the exhibition presents the helicopter was made in Russia. At MILEX-2014 showed a modification of the Mi-8MSB, the release of which has been established in Belarus, PJSC Motor Sich at the site of OAO Orsha aircraft repair plant. A key element of the Belarusian-Ukrainian helicopter has become a new engine manufactured by Motor Sich. He received increased by 30% the service life and saves up to 20% of fuel and increase the range to 600 km, and reach the maximum height 9.150 m (4.500 m against the Russian Mi-8T).
By the time the Belarusian business Boguslayev still on the rise. Start gave him on 30 December 2011 the President of Belarus Alexander Lukashenko signed the decree 335рп by which the state sold its stake (99,2%), OAO Orsha aircraft repair plant (OARS) to two strategic investors. Systems of investments and innovations (Belarus) received 1.488.171 share, PJSC Motor Sich — 2.232.256 shares (about 60%). The purchase price from the Ukrainian side was estimated at $1.1 million — the amount is rather symbolic. Minsk is interested, it seems, is not so much the money as the technology that was supposed to bring in Orsha Ukrainian shareholder.
The plans were grandiose: Orsha was planned to create a service center which was supposed to repair and upgrade helicopters of Soviet/Russian production, primarily for the Russian and Belarusian customers. The next step was supposed to already manufacture its own helicopters. Was soon was the airline Orsha air, and on the basis of the factory airfield began to build logistics complex. In addition, Boguslayev has pledged to invest in the modernization of production capacity of not less than $12 million to increase their load, and improve social sphere of the factory settlement of bolbasovo.
In 2014 Lukashenko set the task to quickly organize in Belarus to manufacture their own helicopters, and using the capabilities of the company Motor Sich. For Boguslayev has opened up new opportunities. But at the same time — because of the Russian aggression in Crimea and Donbass have closed the Russian market, primarily for the repair and modernization of Russian military equipment.
In the same 2014, the Belarusian governmental delegation went to Kiev on negotiations about the transfer to Orsha to produce a compact turbojet engines of Motor Sich used, in particular, for the production of cruise missiles. It is also known that at the end of September 2014 the delegation of the military-industrial complex of Belarus of 22 people attended military enterprises in Kiev, Lviv, Chernihiv and Dnipropetrovsk. Belarusian military Industrialists were primarily interested in plants and organizations (bureaus, research institutes) related to the production of missiles or their components (homing, rocket engines, control systems).
Rumor has it that employees of Ukrainian companies secretly offered to move to Ukraine together with their families, were promised work and housing. Later it became known that with the help of Ukrainian specialists, the Belarusian authorities tried to implement a project to create its own cruise missiles by the Stork.
Around the same time in Orsha has been the release of the Belarusian-Ukrainian helicopter Mi-8MSB modernized version of the Russian Mi-8. It was assumed that a further similar program will be launched engine replacement (replacement of engines by more modern) helicopters: first light multi-purpose Mi-2, and then combat Mi-24 and Mi-35.
The helicopter Mi-8MSB, very competitive on the world market, caused extreme irritation in Russia. The Kremlin official Minsk recalled that the Belarusian company to produce helicopter Russian model, must obtain the appropriate license and respect copyrights. It is clear that the Corporation Russian Helicopters was not going to give such a license to the Belarusian company with the Ukrainian beneficiary. The Russians did not need competitors.
But the main thing — the success of the company Motor Sich for OURS in the eyes of the Russian leadership has questioned the loyalty of Minsk and Moscow.
The first serious problems in the Belarusian business Boguslayev appeared in 2017. First, was not executed in time order to repair helicopters for the Belarusian army. Then the business partner Boguslayev Alexander Garden (to him through the company Systems of investments and innovations owns about 40% stake in OURS) complained to the Prosecutor General, stating that the former Director of the company Oleg Bogatyrev (Boguslayev appointee) has struck the plant and the state major damage. Allegedly, violations of the spent budget funds allocated to OARS for the purchase of components and spare parts in Russia.
In the beginning of 2018, it became known that the total debt of OURS is $35 million, while revenues in 2017 was less than $13 million the state control Committee (SCC) of Belarus said that the plant in Orsha owed to shareholders, investors more than $20 million, of which Motor Sich — $18.7 million
In the last days of April 2018 Belarusian media said that Boguslayev flew to Belarus at the meeting of shareholders of the Orsha aircraft repair plant. “The company is expected to reaccionaria. The General meeting of shareholders was held in two phases on 10 and 27 April 2018. Belarusian shareholder System of investment and innovation — 10 April expressed readiness to return the shares to the state, the Ukrainian Motor Sich — April 27 said it also is ready to return shares of the company to the state”, — reported the Agency Interfax-Zapad.
A representative of management OARS told Interfax that “the head of the Ukrainian company Vyacheslav Boguslayev made after the shareholders’ meeting a proposal to return the state shares OURS and explained that this decision is mainly caused by the conflict between Ukraine and Russia.”
After the shareholders meeting Boguslayev returned to Kiev, but his private plane just released from the country — he remained on the airfield in the settlement of bolbasovo of Orsha, near OURS. Boguslayev flew by plane on 27 April 2018.
The portal Tut.by citing its sources reported that in early may, the Ukrainian businessman was waiting in the administration of the Belarusian President. He was supposed to just give their shares of Orsha factory of the Belarusian state. “The plane is, in fact, taken as collateral or guarantee that Boguslaev will return to Belarus”, — wrote Tut.by.
But the next day after the departure Boguslayev, 28 April 2018, the Prosecutor General’s office of Belarus reported about check of legality of actions of the company Motor Sich for OARS. Then Boguslayev decided not to tempt fate and decided not to return to Belarus for further negotiations.
“Today we are talking about changing the Belarusian shareholder, OARS, said on may 3, 2018 Boguslayev the Agency Interfax-Ukraine. — Local investor refused to perform his part of the investment obligations. Because of this, all the fuss. Its part of the investment commitments as at today Motor Sich has performed 110%”.
According to Bohuslayev says the revised Outlook OARS associated with the political situation. “Today OURS not give spare parts from Russia because of Ukraine, — he said. — The government of Belarus does not protect your company, but it works Belarusians, even for the government orders of the Belarusian army”.
This statement the Prosecutor’s office countered by the fact that on may 15 opened a criminal case against the former General Director of the plant and officials of PJSC Motor Sich from-for excess of office powers, entailed heavy consequences.
In the state military-industrial Committee of Belarus with the author of these lines informally shared that kind of information: from the administration of Lukashenka Boguslaev received an offer to “voluntarily” give up his stake in OURS the Belarusian government in the face of the company-arms exporter belspetsvneshtehnika.
Also the owner of the Motor Sich ordered to refuse the financial claims to the Belarusian side to pay “a penalty for inadequate execution of the investment agreement”. Then against him will not prosecute and will even allow you to continue business in Belarus.
PRESSURE BETWEEN MOSCOW AND KIEV
The author of these lines had a chance from a variety of sources to hear a lot of versions of why “no go” Belarusian business Boguslayev. Credible down to the fact that the official Minsk due to the cooperation with Motor Sich, in equal measure, pressed Moscow and Kiev. In the Kremlin after the start of the conflict with Ukraine was outraged not so much by the production of helicopters, how bad is hiding Lukashenko plans to produce their own cruise missiles by the Stork.
Russian analytical edition of Onboard magazine wrote in 2015: “Given too close Belarusian-Ukrainian relations and prospects of the Belarusian cruise missiles Stork be much more distinct. In early 2012, the Ukrainian company Motor Sich has sold a 60% stake in Orsha aircraft repair plant. One of the conditions of the deal was the production of gas turbine engines. Given current realities, it is obvious that local people are prepared (or ready) to start production of rocket engines MS-350 or MS-400 for the needs of Belarus. By the way, on the basis of MS-400 China in 2009 has created its own cruise missile CJ-10, very similar to the Ukrainian analogue of a Kite. Not coincidentally, the Minsk chose Beijing as a partner to create a reactive system of volley fire — looms on the horizon of its own missile system”.
“After 1991 Motor Sich inherited design documentation for a small turbojet engine P-95-300 and continued their production for customers from Russia. However, in Russia the work was carried out on imports of engines for cruise missiles, says Belarusian military expert Alexander Alesin. — Now on all Russian cruise missiles are used turbofan engines-50 Russian production. This means that Motor Sich has lost the main market of small gas turbine engines. However, in Ukraine created its own version of the R-95-300 (MC-350 and MC-400), and the company received the right of free sale. But it is clear that the attempt of Belarus to produce its own cruise missile in conjunction with the Ukrainians caused extreme irritation among the Russian military”.
According to experts, Moscow has put Minsk condition: either the Belarusian leadership stops cooperation with Motor Sich, or the Russian military equipment will no longer undergo repairs and modernization at Belarusian enterprises. And the second option would mean the loss of a significant part of income and the need to close important for Belarus the defense industry.
From Kiev it was also a pressure on the official Minsk there are not many like Boguslayev desire to cooperate with the Russians to bypass the sanctions. Recall that in March 2014 Ukraine has banned the supply to Russia of arms, military equipment and components. However, the Ukrainian-Belarusian company Orsha could quite legally operate with Russian customers. But to allow that official Kyiv could not have threatened curtailment of bilateral trade that could not accept already Lukashenka.
Attempt Boguslayev on the basis of OARS efficient international division of the company Motor Sich tripped on absolutely different interests of Minsk, Moscow and Kiev. If the project was successful, Ukraine would profit and jobs, including in its territory, at the enterprises-suppliers. However, this was largely the money received from the Russian military, for the modernization of their military equipment.
The current forced output Boguslayev of the Belarus project is rather special episode. Moreover, refusing to cooperate with the company Motor Sich, the official Minsk has kept the strategic line of the development of relations with Ukraine. These relations in the past few years become one of Lukashenka’s increasingly important counterweight to the enormous influence of Russia on his country.
It is unlikely that the Motor Sich will completely sever the business relations with Belarusian companies.
As they say in Orsha plant, they plan to continue repairing Belarusian equipment using Ukrainian parts and components. Mi-8MSB will be assembled (albeit a small amount) for their own Belarusian needs.