MOSCOW. March 18 (Interfax-AVN) - The main condition for successful operation of a single national aircraft producer in Russia is an able mechanism of merger, Alexei Fyodorov, CEO of the Irkut research and production association, said in an interview with the Vedomosti daily, published on Thursday.
"The only problem in creation of a Unified Aircraft Producing Corporation is a concrete merger mechanism. These are complex and controversial processes involving crushed ambitions, dropped production facilities, and dropping some projects in favor of one or two ones with the best market prospects," he said.
According to Fyodorov, as many aircraft plants are main enterprises in respective towns, some are in for hard times.
"In aircraft production it is next to impossible to rearrange production facilities, especially if the workshops are specialized for heavy aircraft, therefore there will be many difficulties. The main thing here will be the political will, not only at the government level," the CEO said.
He emphasized that managers would hopefully realize the urgent need for consolidation.
He said that at the first stage a consortium - the base for the national aircraft producer - and the managing company would be created. "At that stage no production assets are expected to merge, but the consortium is to develop proposals and recommendations as to the merger procedure, a single marketing policy, project and asset evaluation mechanisms, and production arrangement strategy - some things will be disbanded, some rearranged, some concentrated, and some diversified," he said.
According to him, this stage will take up to 18 months, and the proposals are to be ready by 2006. Then will come asset merger alongside rearrangement and decommissioning. At that stage all sources of investment will be embraced, including private capital.
Fyodorov said that Irkut's recent IPO was a way to practice investment attraction. "This is not the only way possible, but the best one for the modern conditions," the manager said.
He said that Irkut's entering the corporation would in no way hinder the interests of Irkut's shareholders.
"Irkut is a joint stock company, and it is up to the general shareholder meeting to take such decisions. We take this or that decision in order to develop the company, get additional orders, and broaden the range of products. In the end this will result in higher value of the (Irkut - Interfax-AVN) corporation," he concluded.