Continental played Russian loto – Kommersant

As Kommersant learned, Continental, which owns a tire plant in Kaluga, signed an agreement to sell a stake in its Russian distributor with C8 Industrial Assets JSC. This company is associated with Armen Sargsyan’s S8 Capital, which deals with state lotteries. A similar deal appears to have been struck at the tire factory, both now awaiting government approval. Armen Sargsyan was called a partner of the co-owner of the Avilon dealer Alexander Varshavsky, Avilon itself is now buying the Kaluga Volkswagen plant. Analysts note that an industrial partner can guarantee the volume of deliveries to the tire plant.

Continental Global Holding Netherlands BV, which owns a tire plant and distributor in the Russian Federation, has signed an agreement to sell its stake in the trading company Continental Tires Rus with Industrial Assets C8 JSC, follows from the financial statements of Continental Tires Rus. The agreement was signed in February, but at the end of March, when the reporting was signed, the requirements for closing the transaction were not fully met. In early March, Continental CEO Nikolai Setzer said that the sale of assets in the Russian Federation, which the company is discussing, includes a tire plant in Kaluga (Continental Kaluga LLC).

The fact that Armen Sargsyan’s S8 Capital wants to acquire Continental’s Russian assets, in particular the plant in Kaluga, Kommersant wrote on March 13. And on April 19, Frankfurter Allgemeine Daily reported that a deal to sell Continental’s Russian assets is awaiting government approval.

“Industrial Assets C8” was originally created in January 2022 as Freitag JSC and at that time belonged to Yuri Mikhailovich Karnaukh, follows from SPARK-Interfax data. The company was renamed in October 2022. Current owners are not listed.

The company owns the Meteor.ru domain and has registered trademarks for Meteor, a brand of elevators that began to be produced at the former American Otis factory. The Meteor.ru website indicates that the brand appeared when S8 Capital acquired the assets of Otis Group. The former Russian division of Otis was renamed Meteor Lift in December 2022, owned by Ice Development JSC with unknown beneficiaries. However, back in the summer of 2022, the Ministry of Industry and Trade reported that it was the S8 Capital group that acquired the Russian business of Otis. S8 Capital itself develops IT solutions in the financial sector, retail, telecommunications, e-commerce and media, owns Stoloto, a distributor of state lotteries.

In the Russian office of Continental, when asked about the agreement with Industrial Assets C8 JSC and the status of the transaction, they only noted that the company is considering various strategies in relation to its Russian assets, including a controlled exit from the market. Now the company’s representative offices, in particular Continental Tires Rus and Continental Kaluga, “continue to operate as usual, fulfilling their obligations to customers, employees and partners in full.” The plant produces tires of three brands: Continental, Gislaved and Matador, with a capacity of 3.3 million tires per year.

In S8 Capital, Kommersant was told that they did not comment on “transactions for confidentiality reasons”, indicating that they were “considering various assets on the market that may be attractive for the holding with a view to purchasing.”

The day before, a government commission approved the sale of the Volkswagen plant located in Kaluga, Vedomosti and Telegram channels reported. As Kommersant wrote, Alexander Varshavsky’s Avilon car dealer plans to produce Chery cars there (see Kommersant dated April 6). The media called Armen Sargsyan a business partner of Mr. Varshavsky.

Automotive expert Vladimir Bespalov notes that the presence of an industrial partner can provide the new owner of the tire plant in Kaluga with guaranteed demand, but still, the secondary equipment market is more attractive due to volumes. In his opinion, the line of future products is unlikely to consist of existing brands, but in theory the company can receive Continental technologies.

Olga Nikitina, Dmitry Kozlov