Bank investment into the ‘fifth’ generation aviation engine

Perm/03.05.2012 In mid-April at a session of the planning committee of United Engine Corporation Management Company chaired by OBORONPROM general director Andrei Reus, two of the five projects in the program for potential development of the Perm Engine Company’s ‘Strategy 2020’ — Creating an Assembly and Test Center, and Reorganizing the Repair Workshop. These initiatives will be implemented up to 2016 with financing out of federal target programs to attract investment in the amount of 2.7 billion rubles, oh which more than 900 million rubles will be in hand already by 2012.

The implementation of these projects is of high priority for the development of the Perm Engine Company, since it will allow the company to run production of at least 200 fourth-generation PS-90A aviation engines and 100 fifth-generation PS-14 engines by 2019, as well as repairs of at least the same number of engines of these models, and gas turbine units built on this basis. The repair period for each engine is also to decrease by 112 calendar days by 2013.

Today the Perm Engine Company is working on selecting strategic partners to realize these large-scale projects. Under consideration is NOTA Bank. To date, Perm Engine Company and NOTA Bank have signed an agreement on opening a credit line in the amount of 600 million rubles for two years. In the long-term perspective they are considering various ways of expanding on this cooperation, including and in particular by implementing joint investment programs.

DmitriyOvsyannikov, Perm Engine Company director for economics and finance

"Achieving the targeted indicators of the Strategy 2020 will allow Perm Engine Company to regain its status as the largest mass producer of engines for civil aviation and industry in Russia. We can only fully realize these plans in close partnership with the state and with banks. Setting up production and launching onto the market a technically complex and innovative product, such as a fifth generation gas turbine engine, in the production of which dozens of companies and hundreds of thousands of people have played a part, is a significant event not just for an isolated company, but for the industry, the region, and the country as a whole. Therefore we consider the current talks as an important stage in this joint work, which must bring positive results for all parties.

Further information:

Perm Engine Company (PMZ) mass produces aviation engines for civil and military applications, as well as industrial gas turbine units for power stations and gas transportation.

PMZ is a part of the United Engine Corporation, a wholly-owned subsidiary of OBORONPROM specializing in engine-building assets.

OBORONPROM is a multi-faceted machine-building group of companies, founded in 2002. It is part of the Russian Technologies group of companies. Its primary activities are helicopter building (Russian Helicopters) and engine-building (UEC).