United Engine Corporation in Purchase of Blocking Minority Stakes in Aviadvigatel, Perm Engine Company and Perm Motors Company
November 30, 2011
Cleary Gottlieb is advising United Engine Corporation and its parent company OJSC OPK Oboronprom on the purchase of blocking minority stakes in Russian engine developers and builders, OJSC Aviadvigatel, OJSC Perm Engine Company and OJSC Perm Motors Company, from United Technologies Corporation, Pratt & Whitney Division (“P&W”). UEC was a controlling shareholder in the target companies and this transaction is a further step in the consolidation of Russian engine design and production assets, as a result of which UEC will be able to benefit from Russian government programs in support of Russian producers. UEC and P&W have enjoyed a long-standing relationship and may continue cooperation on other projects in the future.
UEC is 100% owned by Oboronprom, a subsidiary of the Russian Technologies State Corporation. UEC is a holding company for 80% of Russian assets in the engine development and building industry. OJSC Aviadvigatel, OJSC Perm Engine Company and OJSC Perm Motors Company design and produce engines for Russian military and commercial transport aircraft. They also design and produce high-efficiency gas turbine units for electric power stations and for gas pumping plants. One of UEC’s aircraft engines was developed in co-operation with P&W. P&W is a U.S.-based aerospace manufacturer with global service operations; its aircraft engines are used in both civil aviation and military aviation. In addition to aircraft engines, P&W manufactures gas turbines for industrial and power generation, marine turbines, and rocket engines.
Cleary Gottlieb has advised UEC on Russian corporate and U.S. intellectual property matters. This transaction was also preceded and accompanied by the firm’s advice on U.S. sanction and export control issues.