A Ukrainian court seized all shares and assets of engine manufacturer JSC Motor Sich as a part of an ongoing criminal investigation.
The security service of Ukraine (SBU) announced that the Shevchenkivskyi District Court of Kyiv decided to temporarily freeze all shares and assets of Motor Sich as the authorities run a criminal investigation regarding the Chinese aviation company’s Skyrizon aim to purchase a controlling stake in the privately-held engine manufacturer.
The Main Investigation Department of the SBU is carrying out the pre-trial investigation to examine the alleged violations of the Ukrainian law during the initial privatization of Motor Sich as well as a potential breach of the Criminal Code of the country regarding sabotage and subversive activities in favor of Russia.
According to the SBU press center, the assets of Motor Sich were put under the Asset Recovery and Management Agency of Ukraine (ARMA) control. The engine manufacturer will continue working in accordance with current legislation requirements while preserving the jobs and fulfilling its obligations within the framework of production orders, the SBU reported.
“This is not only about the fate of one enterprise but about how the state is able to protect its own interests. Since the security of the Ukrainian Motor Sich is a matter of national security,” the Head of SBU Ivan Bakanov was quoted in the statement.
At the beginning of March 2021, the government of Ukraine decided to nationalize Motor Sich, the engine maker which builds engines powering the world‘s largest cargo aircraft such as the Antonov An-225 Mriya and An-124, to prevent its acquisition by the Chinese investors as the deal raised doubts over its strategic effect to the national security.
Washington,the largest military aid supporter of Ukraine, expressed suspicions that under the acquisition of Motor Sich, China was attempting to secure vital manufacturing capabilities for its aerospace and military industry, specifically to produce engines powering large aircraft and helicopters.
The Secretary of the National Security and Defense Council of Ukraine Oleksiy Danilov outlined that the ownership of the manufacturer would be returned to the state „in a legal, constitutional way”, while the Chinese investors, which held up to 75% of Motor Sich stake, would receive compensations.
In January 2021, Ukrainian President Volodymyr Zelensky signed presidential decrees sanctioning Skyrizon and three other Chinese companies that showed interest in acquiring Motor Sich. The sanctions prevent the parties from holding any stakes in a Ukrainian company for three years.