Moscow, 24 October 1997 (RFE/RL) -- Officials from Russia's troubled KamAZ truck maker plan to travel to New York today to meet with directors of a U.S. firm that was supposed to help it raise money and attract investment.
RFE/RL's correspondent in Kazan quotes KamAZ managers as saying that the company is now on the verge of bankruptcy. KamAZ owes more than $500 million in back taxes to the Russian government and must pay about half of it by the end of this year. Production has halted since October 16 because the firm is short of cash to pay its suppliers.
Led by KamAZ board director Ravil Muratov, who also is the Deputy Prime Minister of Tatarstan, the KamAZ delegation reportedly will meet with directors of the firm Kohlberg, Kravis, Roberts & Company (KKR).
KKR signed a contract in 1994 pledging to attract investments of $3.5 billion to KamAZ over ten years. But Muratov suspendeded the agreement in August, charging that KKR had failed on its promise. Under the deal, KKR was supposed to obtain a 32 percent stake in KamAZ. It has, so far, helped to bring in about $700 million through debt rescheduling and investments.
KamAZ has lost money for at least the last three years. Several medium and top-level managers at KamAZ have been arrested on corruption charges since Muratov became director in July and authorities in Kazan launched investigations into alleged cases of misappropriation.
RFE/RL's correspondent in Kazan quotes KamAZ managers as saying that the company is now on the verge of bankruptcy. KamAZ owes more than $500 million in back taxes to the Russian government and must pay about half of it by the end of this year. Production has halted since October 16 because the firm is short of cash to pay its suppliers.
Led by KamAZ board director Ravil Muratov, who also is the Deputy Prime Minister of Tatarstan, the KamAZ delegation reportedly will meet with directors of the firm Kohlberg, Kravis, Roberts & Company (KKR).
KKR signed a contract in 1994 pledging to attract investments of $3.5 billion to KamAZ over ten years. But Muratov suspendeded the agreement in August, charging that KKR had failed on its promise. Under the deal, KKR was supposed to obtain a 32 percent stake in KamAZ. It has, so far, helped to bring in about $700 million through debt rescheduling and investments.
KamAZ has lost money for at least the last three years. Several medium and top-level managers at KamAZ have been arrested on corruption charges since Muratov became director in July and authorities in Kazan launched investigations into alleged cases of misappropriation.