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DMG Mori and Livgidromash get special investment conditions

Two special investment contracts (SICs) were executed with DMG Mori (machine tool building) and Livgidromash (machine building) in the course of the 15th International Investment Forum "Sochi 2016". The amount invested in these hi-tech projects totaled about RUB 7.5 billion.

SIC is an agreement between the Russian Government and an investor aimed to launch or upgrade commercial production in Russia and to subsequently localize it. In exchange for investments (not less than RUB 750 million), the Government offers tax and other preferences until such time as the project starts generating operating profits plus 5 years, but not more than 10 years.

DMG Mori, a German-Japanese innovative construction company, will additionally invest into a project designed to construct and develop the Ulyanovsk Machine Tool Building Plant (to be owned by DMG, Gildemeister). The company has a total of 22 plants across the globe. The Ulyanovsk Region will host a facility that will design and manufacture metal-processing turning lathes and milling machines and components for them. Main consumers will include such industrial companies as United Aircraft Corporation (UAC), Rostec Corporation, United Engine Corporation, etc. The contract term is expected to be 10 years with the total amount of investments being RUB 5 billion.

HMS Hydraulic Machines & Systems Plc (Cyprus) owning facilities manufacturing pumps and compressors in Russia, Belarus Republic and Ukraine plans to invest into a facility to be located in the Orel Region to manufacture hi-tech large-capacity pump equipment for the oil and gas industry (API standards) as well as for power economy and water utilities. The new facility will allow reducing dependence on imports by satisfying the requirements of target sectors. The total amount to be invested into the project is going to be RUB 2.6 billion. The contract term will be 6 years.

Therefore, a total of 4 SICs have been executed in Russia for the time being. Earlier, a contract was executed at the St. Petersburg Economic Forum 2016 with German Claas to create an agricultural machinery plant in the Krasnodar Territory. Another contract was executed during the 2016 Eastern Economic Forum with Mazda Sollers Manufacturing Rus to erect a facility in Vladivostok.

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