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. Last Updated: 07/27/2016

Siemens Forms Nuclear Partnership

MTSiemens CEO Peter Loscher announcing plans to build a $45 million transformer factory in Voronezh on Tuesday. He later met Vladimir Putin and said Siemens and Rosatom would assess closer cooperation.
Siemens and Rosatom will work together to strengthen their positions on the nuclear market, the companies said Tuesday, fueling speculation that Europe's largest engineering company could create a joint venture with Atomenergoprom, an affiliate of Russia's state nuclear corporation.

The announcement followed a raft of other agreements announced earlier in the day, including plans to build a factory in the Voronezh region and increase cooperation with Gazprom.

The nuclear partnership even received the blessing of Prime Minister Vladimir Putin, who used his opening speech at the World Economic Forum last week to suggest that Russia would remain open to foreign investment.

"Our interests on the market of nuclear technologies coincide with those of Siemens," Rosatom chief Sergei Kiriyenko told reporters. "Uniting our potentials will significantly bolster both Siemens' and Rosatom's positions on the world nuclear market."

To that end, Siemens and Rosatom agreed to create a working group to develop joint projects by the end of April, Siemens chief executive Peter Loscher said. Siemens has worked with Rosatom on two power plants in Slovakia and a nuclear power station in Bulgaria.

German newspaper Frankfurter Allgemeine Zeitung reported last month that Siemens was eyeing a possible joint venture with Atomenergoprom after deciding to sell its 34 percent stake in Areva, a French builder of nuclear reactors.

Rosatom spokesman Sergei Novikov said Siemens could now cooperate more closely with Rosatom because it was divesting from Areva, the nuclear monopoly's direct competitor. Novikov said no concrete projects, including joint ventures, were discussed at the talks.

Igor Tabakov / MT
Voronezh Governor Vladimir Kulakov, center, shaking hands with a Siemens official on Tuesday in Moscow.
Cooperation between Rosatom and Siemens could go beyond the borders of a joint venture, Putin told Loscher.

"We are ready to switch from single-piece projects to the realization of full-scale cooperation between Siemens and Rosatom so that the companies could actively work in Russia, Germany and on the markets of the third countries," Putin said.

Siemens' operations in Russia range from producing turbines and car components to selling hearing aids and vacuum cleaners. The company holds a 25 percent stake in Russian engineering firm Power Machines as well as controlling stakes in a number of other Russian enterprises, mainly in the instrument-making sector.

Earlier in the day, Loscher said Siemens would invest 35 million euros ($45 million) to build a factory to produce high-voltage transformers for electricity grids. The plant, to be launched in 2011, will be the first factory Siemens has built in Russia since the company's assets here were nationalized in 1916.

In a separate meeting, Gazprom said it would cooperate with Siemens on producing Liquefied Natural Gas, the gas export monopoly said on its web site. LЪscher also met Gazprom chief executive Alexei Miller on Tuesday.

Loscher said Siemens would also service turbines for Mosenergo and OGK-2, generating companies controlled by Gazprom, and Inter RAO.

Additionally, Siemens agreed to supply X-ray equipment to seven regional centers of Petromed, a Russian medical equipment company.

Dietrich Moller, Siemens president for Russia, said the company was negotiating with Russian Railways on building trains for high-speed routes from Moscow to St. Petersburg and Sochi's Adler district.

Deutsche Bahn could take part in the project, Moller said.