Zil is a major
truck and
limousine manufacturer based in
Moscow. All those long, black limos ferrying senior
Party officials through snowy Moscow streets were made by Zil. Just to prove what a complete
corporate whore i really am, here's a
potted history of what happened to the company since the fall of the
USSR.
Zil employs more than 100,000 workers and used to produce up to 200,000 vehicles a year. Its main customers were traditionally the Soviet military and agro-industrial complex.
According to the Zil privatisation plan, adopted in 1992, enterprise employees received 40 percent of its shares, 166 managers received a total of 5 percent of shares, 35 percent of shares were to be sold at auction and the remaining 20 percent of shares were divided between the Moscow Property Fund and the Company Workers Reserve Fund.
In March 1993 about 15 percent of Zil shares were put up for sale at the first Russian inter-regional voucher auction with tenders taking place in 15 cities simultaneously. In June 1993 about 5 percent of shares were sold at a national cash auction.
Eventually, 26 percent of all shares (35 percent of voting stock) were concentrated in the hands of Microdin Trading Company which became the single largest Zil shareholder. Microdin spent about 5 million dollars for its stake but did not take an active role in Zil's management until the beginning of 1995, when it became clear that the enterprise's financial position was deteriorating rapidly and enterprise managers were intending to place Zil into a financial-industrial group with UNEXIM Bank. Microdin publicly assessed these plans as an "irresponsible redistribution of ownership rights".
In Spring 1995, Anatoly Yefanov, the Chairman of Microdin's Board of Directors, took the post of President/Director General of Zil. His predecessor, Valentin Saykin, kept the position of Chairman of the Enterprise Council.
When Yefanov became President/Director General in the Spring of 1995, new restructuring plans were immediately implemented. Financial and marketing problems were given particular attention. In March 1995, Resurs Bank, controlled by Microdin, opened a 55 billion ruble credit line for the comapny, and new measures were instituted to stop widespread stealing of materials from the factory.
Despite these efforts, the enterprise's position continued to deteriorate. While the target output for 1995 was 47000 vehicles, only 12000 vehicles were actually built. Debt to Resurs Bank grew to R150 billion by the end of 1995 and inevitably, the relationship between the new owners and the old management became infused with hostility. In January 1996 the Enterprise Council voted Yefanov out of office.
The World Bank has now bought a controlling interest in Zil from Microdin and the comapny is undergoing a vigorous restructuring procedure. Bank officials say they hope to turn their first profit in third quarter, 2003 and then reprivatise by issuing shares on the Moscow market.