In his opinion, the Antimonopoly Committee can now only find fault with the commas.
The Antimonopoly Committee of Ukraine returned the package of documents submitted by the DCH group to agree on the purchase of a 25% stake in PJSC Motor Sich. It was reported by the DCH’s Press Service.
‘The document states the AMCU did not accept the application for consideration,’ DCH said on its website. ‘The text lists a number of technical procedural points justifying the decision of the committee and made a request for additional information."
The request for information, in particular, concerns the medical services market, where both the aircraft-building JSC Motor Sich and the diversified DCH group are present in an allegedly significant way for the acquisition of shares. ‘According to the information of the applicants, the list of legal entities given in the table “Other legal entities in which Motor Sich owns corporate rights”, JSC Motor Sich exercises control over Clinic Motor Sich LLC, the main activity of which is the provision of medical services. In the DCH group the services of general medical practice are provided by Medical Centre Nasha Nadezhda LLC,’ the Press Service quotes the letter of the AMCU.
‘Frankly speaking, I want to cry and laugh at the same time from the AMCU's letter,’ Aleksandr Okhrimenko, the President of the Ukrainian Analytical Centre, expressed his opinion about the AMCU's response to investors. ‘We are talking about an attempt to revive the production of aircraft engines and aircraft construction in general in Ukraine. But instead, the AMCU is interested in the assets of DCH and Motor Sich in the field of medicine. It is a nonsense! The market is not just segmented, it is not saturated as new private clinics and their networks are being built and created in Ukraine, but still there is enough work for everyone. The market has not even reached saturation, let alone some possible concentration or monopolization!’ the expert was surprised by the AMCU's interest in the non-core commodity market for the parties to the transaction.
The expert assesses the AMCU's attempt stated in the message of the DCH Press Service to find a link between the secondary production of agricultural machinery at Motor Sich and the Kharkiv DCH Tractor Plant in a similar way. ‘And what relation do KhTZ’s tractors have to aircraft engines? Are they planning to launch them into the sky, or will they compete with airplanes?’ Mr Okhrimenko comments ironically.
But the expert was especially surprised by the AMCU's interest in the assets of DCH and Motor Sich in the financial sector. For some reason, the AMCU's response letter contains a list of financial companies that provide services of a completely different nature. Not to mention the fact that quite recently the committee approved DCH's purchase of Credit Dnipro Bank, and should quite clearly represent the place of this group in the financial services market.
‘The request of the AMCU to provide data on the financial sector is simply the “bottom” of the qualifications of its “analysts”. The companies listed in its request operate in different segments of the financial markets, which are under the “supervision” of three state financial regulators – the NBU, the NSSMCU, the NFSCU... There are no questions asked by these three profile regulators! Only the AMCU was distinguished by intelligence and ingenuity!’ the expert was surprised by the AMCU's interest in the facts that they already knew.
Mr Okhrimenko believes that the vague wording and strange requests of the AMCU, which are not related to the purchase of PJSC Motor Sich’s shares, are an opportunity in the future to try again to disrupt the agreement on the purchase of shares, citing formal reasons in the same way. ‘It seems that when submitting the next request for the concentration of Motor Sich’s shares, the AMCU will attract a professional proofreader to find fault with punctuation marks and grammar in order to return the documents for revision again,’ Mr Okhrimenko notes the paradoxes of Ukrainian investment reality. The expert believes that before the main obstacles to investment in Ukraine were law enforcement agencies, tax authorities and courts. And now the AMCU has been also added to the list.
As it is known, the DCH Group signed an agreement with Skyrizon Aircraft Holdings Limited on the joint development of the Ukrainian aircraft industry and, in particular, the Motor Sich plant, on August 4. Subsequently, the ‘daughter’ of Chinese Beijing Skyrizon and DCH Group submitted a joint application to the Antimonopoly Committee of Ukraine (the AMCU) to purchase shares of PJSC Motor Sich.
