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Money News

Russian weapons maker Kalashnikov acquired by former government official

A man visits the stand of Kalashnikov Group at the St. Petersburg International Economic Forum (SPIEF), Russia June 7, 2019. REUTERS/Maxim Shemetov/Files

MOSCOW (Reuters) - A former Russian deputy transport minister has acquired a controlling stake in weapons maker Kalashnikov, the company said on Friday.

Alan Lushnikov, who served as deputy transport between 2017 and 2018, has acquired a 75% stake minus one share in Kalashnikov via a firm called TKH-Invest.

Lushnikov acquired the stake from Deputy Defence Minister Alexei Krivoruchko, who was among the high-ranking Russian officials hit with European Union sanctions last month over the poisoning of Kremlin critic Alexei Navalny.

State conglomerate Rostec owns the remaining 25% plus one share in Kalashnikov.

The arms maker has been under U.S. sanctions since 2014, in the wake of Moscow’s annexation of Crimea from Ukraine and its support for pro-Russian separatists in the country’s east.

Kalashnikov did not disclose the terms of the deal.

A financial market source told Kommersant newspaper that the deal could be worth as much as 1 billion roubles ($12.91 million).

Reporting by Anton Kolodyazhnyy and Gleb Stolyarov; Writing by Gabrielle Tétrault-Farber; Editing by Gerry Doyle

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