Great future ahead of Belarusian MTZ Holding

04 june 2014 года

The holding company MTZ Holding is being set up in Belarus. Its profit from sales is estimated to be able to exceed Br1,970 billion in 2016.

Forecasts indicate that if the potential of the integrated structure is used wisely and a quality risk management system is built, profits from sales may exceed Br1,970 billion as early as 2016, noted the official. He specified that in 2016 the profitability of sales of the holding company is supposed to reach 9.5%. The figure can be secured by reducing material costs, reducing non-manufacturing losses, optimizing delivery times, assimilating new R&D products, and expanding the choice of manufactured products.

Press Secretary of the Belarusian Industry Ministry  Sergei Shalai pointed out that the idea behind the creation of MTZ Holding is to build an effective structure to manage daughter enterprises and fuel the development of the scientific, technical, and manufacturing potential. The holding company is also needed for the sake of pursuing a coordinated manufacturing, sale, procurement, financial and investment policies. Since state-owned packages of shares will be injected into the charter fund of OAO Minsk Tractor Works (MTZ trademark), the managing company will be able to exercise proper control over the operation of daughter enterprises.

Industry Ministry experts believe that the creation of the holding company will enable several advantages. In particular, higher export will be secured by carrying out joint market research programs, product placement and active product promotion. The volume of foreign currency earnings will rise, the pricing policy will be streamlined, and the resolution of problems of the enterprises will be consolidated. Apart from that, transactions between participants of the holding company will be accelerated, they will be able to share spare financial resources, and coordinate their actions in the course of the implementation of large-scale investment projects.

Plans have been made to modernize daughter enterprises at the expense of the investment fund of the managing company. The investment fund will accumulate financial resources of the entire holding company.

MTZ Holding will have to accomplish several goals. The company will have to keep steady shares of the existing markets taking into account demands of customers on various markets, stressed Sergei Shalai. The holding company will also have to penetrate new markets by developing the distribution chain by retaining services of foreign agents and distributors. It is also important to increase the output capacity, expand the product choice of Belarus-trademarked tractors, introduce peculiar traits that will make the tractors different from competitors for the sake of attracting more customers, said the Press Secretary of the Belarusian Industry Ministry.

BelTA reported earlier that the Council of Ministers of Belarus issued executive order No.526 on 30 May to create a holding company that will comprise ten enterprises grouped around Minsk Tractor Works. In line with the document shares of nine enterprises that are currently in national ownership and management of the Industry Ministry will be transferred into the charter fund of the public joint-stock company Minsk Tractor Works (MTZ trademark). The shares will represent a non-monetary contribution of the daughter enterprises to the holding company.

Apart from Minsk Tractor Works the holding company will comprise nine enterprises: Bobruisk Plant of Tractor Parts and Units, Vitebsk Plant of Tractor Spare Parts, a mechanical repairs factory in Lepel, an electromechanical factory in Lepel, Minsk Factory of Special Instruments and Technological Equipment, Minsk Gear Works, Mozyr Machine-Building Plant, Narovlya Hydraulics Plant, and a hydraulic equipment factory in Khoiniki.

MINSK, 4 June (BelTA)

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