Amtel-Vredestein Suspends Production at Kirov Factory

Amtel-Vredestein is halting production at its Amtel-Povolzhye factory in Kirov, Russia. Upon making the announcement on August 19 the company said the stoppage is the result of a working capital shortage it has experienced in recent months.

A second tranche of the stabilisation loan provided by Sibur Russian Tyres is anticipated by Amtel-Vredestein in accordance with previously made agreements. The provision of such funding is subject to the passing of resolutions at the company’s Extraordinary General Meeting of shareholders, scheduled for 29 August.

The company says it is undertaking steps to ensure the Kirov plant will return to normal operating rates and inventory levels as soon as possible. Assuming the second tranche of the stabilisation loan is advanced soon after the EGM on August 29, Amtel-Vredestein believes this temporary halt will not affect its ability to meet supply obligations in a timely manner.

This stoppage is the second experienced by the company this year; in mid-February production at Kirov halted for several days due to what the company called a “temporary suspension in the supply of raw materials”. This supply problem was rectified through the signing of a contract with Sibur Russian Tyres.