Russia’s Global Navigation Satellite System (Glonass) is to become a joint-stock company with private firms potentially bought in as minority shareholders, according to local media.
President Vladimir Putin has requested that a Glonass joint-stock…
Russia’s Global Navigation Satellite System (Glonass) is to become a joint-stock company with private firms potentially bought in as minority shareholders, according to local media.
President Vladimir Putin has requested that a Glonass joint-stock company be formed and the Russian Ministry of Transport is currently preparing its recommendations for the plan.
Local newspaper Kommersant claims that the Russian Ministry of Finance has recommended that the report look into the possibility of inviting Russian mobile phone operators and developers to become shareholders in the newly formed company.
According to the report, the ministry recommended that telecoms operators, including MTS, VimpelCom and MegaFon, could be brought in alongside the state-owned technology investment corporation Rostec to help fund the commercialisation of Glonass.
Kommersant added that 12 Russian companies are already involved in non-profit partnerships with Glonass, including the domestic telecoms operators as well as Russia’s largest internet company Yandex.
However, these potential shareholders will not be asked to finance the current roll out of the system with President Putin ordering the government fund its completion system to enable the launch of Era-Glonass, the road accident emergency response system that uses the satellite network.
State news agency Itas-Tass quoted the president at a cabinet meeting as saying: “I am aware of all the budget constraints. Preparing the federal budget for the next two years is difficult and complicated work, but billions [of rubles] have already been spent [on Era-Glonass] and we cannot abandon it halfway.”
So far the government has spent around Rbs4bn (US$95m) on Era-Glonass, while it has forecast spending a further Rbs1.95bn (US$45m) on the Glonass system from 2014 to 2017.
Meanwhile, the Russian state development bank Vnesheconombank (VEB) has reportedly revealed plans to provide loans and investment to companies seeking to develop technology and services that utilise Glonass.
Via its VEB Innovations unit, the bank will set up an RBs8bn (US$185m) Glonass fund that will begin making its funds available in early 2015. VEB will provide RBs5bn of the fund with private investors expected to supply the remainder.
As well as developing domestic tech start-ups, the fund will seek assistance from foreign companies to develop navigation hardware & software, GIS and mapping software for the Glonass system.
Russian daily Izvestia listed eight European companies in particular that VEB would target for technology acquisition. These were Norway’s Q-free, Benomad from France, German companies Peiker, Init and IVU, Switzerland’s Saphyrion, AND of the Netherlands and Slovakia’s Sygic.
