AvtoVAZ Head Says Car Giant Unable To Develop New Projects Due To State Shares Kept As Pledge

AvtoVAZ, the Russian car producing giant, will be unable to develop new projects until it recovers a block of shares kept by the state as pledge, chairman of the AvtoVAZ board Vladimir Kadannikov announced in Moscow today. He noted that an order on returning the state shares to AvtoVAZ was prepared a long time ago but the government has not approved it yet. At present, the debt of AvtoVAZ amounts to 1.5 billion rubles ($51 million), while the block of state shares is evaluated at 16 billion rubles ($539 million). In other words, this money is not used, and even a rich country cannot afford this, Kadannikov was quoted as saying. He stressed that in view of this, AvtoVAZ cannot issue additional shares, bonds or eurobonds. Meanwhile, the company needs these measures to attract investments for the production of new car models. It is worth mentioning that the total debt of AvtoVaz was about 2.855 billion rubles ($96 million) and it has already repaid 1.2 billion rubles ($40 million).