Affected by the Russian-Ukrainian conflict, Russia’s shipbuilding industry suffered serious Western sanctions, resulting in the country’s inability to obtain advanced equipment and technical support from the hands of European manufacturers. In order to solve the industry’s predicament, Russia has taken internal integration and other self-help ways to promote the development of the shipbuilding industry, but with little success.
On March 18, Russia’s second-largest lender VTB announced that the company’s acquisition of Zvezda shipbuilding from Rosneft had ended in failure because VTB’s United Shipbuilding Corporation (USC) was unable to provide sufficient funds for the acquisition.
At the end of last year, Rosneft started negotiations with VTB on the merger of Zvezda shipbuilding into USC, emphasizing that this consolidation of shipbuilding assets would contribute to the efficiency of the Russian shipbuilding industry.
It is worth mentioning that the integration has also been supported by Russian President Vladimir Putin. Nevertheless, according to the latest news from VTB CEO Andrei Kostin: “Negotiations have been impossible and the two sides will no longer reach an agreement. USC is unable to finance the acquisition.”
VTB currently operates Russia’s largest shipbuilding group, USC, which was established in March 2007 and has more than 40 companies covering design institutes, research centers, shipyards, ship repair and machine building plants, integrating the majority of Russia’s domestic shipbuilding resources, with a workforce of 95,000, whose products include merchant ships, nuclear submarines, aircraft carriers and Its products include merchant ships, nuclear submarines, aircraft carriers and other types of naval vessels.
Zvezda Shipbuilding is a subsidiary of Rosneft, one of the world’s largest listed oil and gas companies, located in the port of Bolshaya Kamen in Primorsky Krai. Zvezda Shipbuilding is a key project of Putin’s revitalization of the Russian shipbuilding industry. It is jointly established by Rosneft, Rosneftegaz and Gazprombank. As the most advanced shipyard in Russia, the shipyard focuses on building various large civilian ships, icebreakers and marine equipment.
Earlier this year, Zvezda successfully delivered the 69,000 dwt ice-class tanker Valentin Pikul for the first time after a difficult period. It took nearly seven years from the ordering of the vessel to its delivery, and four years from the laying of the keel in December 2020 to the official delivery of the vessel. Following the Valentin Pikul, Zvezda will also deliver its first Arc7 ice-class LNG carrier, the Aleksey Kosygin. The vessel began sea trials last December and is expected to be delivered in 2025.