Russian truck maker KAMAZ plans to sell stake


KAMAZ, Russia’s largest truck maker, may sell a quarter of its shares for $1.25 billion this year to a strategic investor from the European auto sector, sources familiar with KAMAZ’s plans said on Tuesday.

Just a few weeks ago France’s Renault bought a quarter of Russia’s largest car maker, AvtoVAZ, as global car makers scramble for a share of a Russian market set to become Europe’s biggest in a few years.

Sources familiar with KAMAZ’s plans said Germany’s MAN AG, Sweden’s Scania and Volvo and Italian firm Iveco were among potential investors in the firm. But they said KAMAZ was also considering a secondary share offering or a merger with Belarussian truck maker MAZ, which would significantly change the strategic stake sale plan. “Most likely, the deal will be planned in two stages: a sale to a strategic investor to raise the valuation, and then a share issue,” one source said on the sidelines of a Russian Economic Forum in Singapore organized by Troika Dialog brokerage.

The source told reporters that, if the sale takes place, KAMAZ would be valued at 10 times its EBITDA, or $5 billion. The plan for KAMAZ would mirror developments at AvtoVAZ, which was first consolidated by state firm Rosoboronexport with the help of Troika Dialog. In February, the duo sold 25% of AvtoVAZ to Renault for over $1 billion. They plan to float around 25% of its stock with the aim of keeping over 25% in state hands. Unlike AvtoVAZ, KAMAZ is controlled by its management, which has built up a stake of over 50%, also with the help of Troika Dialog. The government owns around 30% and has said it may sell its stake via a London placement.


Both AvtoVAZ and KAMAZ are big Soviet-era manufacturers located in the neighboring Volga regions of Tatarstan and Samara. Foreign car makers started actively investing in Russia a few years ago, when the country scrapped import duties on car parts. Over a dozen global players have opened or plan to open assembly plants in the near future. The tax grace period has expired, but as Russian demand for cars is showing no signs of cooling down, global players are looking for new cooperation deals and partnerships. Foreign car sales in Russia have seen double-digit percentage growth in recent years as incomes have risen fast along with economic growth, while high inflation has discouraged saving and supported booming consumption.

A second source familiar with KAMAZ’s plans also said the firm would borrow $200 million via a syndicated loan in the Q2. The loan would fund the company’s investment program and refinance existing debt. The three-year loan would have a margin of 275 basis points over LIBOR and was being arranged by Citigroup, the source said. KAMAZ is traded on Moscow’s MICEX and RTS exchanges but has no foreign listing. It produces nearly three quarters of Russia’s dump trucks and about half of the country’s other large cargo vehicles. The second source said the company, which exported every fourth truck it produced last year, was also interested in buying an assembly plant in India. (Reuters)

Policymakers Cut Central Bank Base Rate by 50 bp to 7.75% MNB

Policymakers Cut Central Bank Base Rate by 50 bp to 7.75%

Bulgaria's Household Income, Spending Rise 20% in 2023 World

Bulgaria's Household Income, Spending Rise 20% in 2023

Special Effects Expands Portfolio With Acquisition of Creati... Deals

Special Effects Expands Portfolio With Acquisition of Creati...

Hungary Launches HUF 15 bln Tourism Sector Support Program Tourism

Hungary Launches HUF 15 bln Tourism Sector Support Program


Producing journalism that is worthy of the name is a costly business. For 27 years, the publishers, editors and reporters of the Budapest Business Journal have striven to bring you business news that works, information that you can trust, that is factual, accurate and presented without fear or favor.
Newspaper organizations across the globe have struggled to find a business model that allows them to continue to excel, without compromising their ability to perform. Most recently, some have experimented with the idea of involving their most important stakeholders, their readers.
We would like to offer that same opportunity to our readers. We would like to invite you to help us deliver the quality business journalism you require. Hit our Support the BBJ button and you can choose the how much and how often you send us your contributions.