Russian court orders forced sale of major shipyard’s pledged shares

A Moscow commercial court has ordered the sell-off of major naval shipyard Baltiysky Zavod’s stock which had been pledged as a collateral against Russian central bank loans. The court ruling affects 88.32 percent of the Baltiysky Zavod shipyard's shares, pledged as security for a 32 billion ruble ($1 billion) loan extended by the central bank to International Industrial Bank, formerly part of United Industrial Corporation owned by Kremlin-connected tycoon Sergei Pugachyov. The court set the selling price of the foreclosed stock at 220 rubles ($6.80) per share. The bank lost its banking license last fall, after defaulting on its obligations. The central bank had previously requested the court to transfer the pledged stock to it in trust as a relief measure, saying the stock was managed inefficiently, which could reduce its price. In November, the court ordered a market evaluation of the shipyard’s stock, appointing auditor Ernst & Young to conduct it. The holders of the shares were ZAO Yunior, ZAO TechnikLine, OOO Nano-Stroi, ZAO Inter-Stroi and ZAO Trust Holding. Deputy Prime Minister Dmitry Kozak said in early December that the government would have to form a new company to manage the Baltiysky Zavod plant, which was burdened with a debt of 15 billion rubles. The yard, which has built over 500 ships since its foundation in 1856, makes ice-breakers, warships and heat exchangers for nuclear power plants.