Siemens scales back Russian ops over Crimea turbines

Saturday, 22 Jul, 2017

"All four gas turbines that were delivered in the summer of 2016. have since been locally modified and illegally moved to Crimea", the group said in a statement, adding that it would divest its minority stake in Russian company Interautomatika, which sells power plant control systems.

Russian Federation illegally annexed Crimea from Ukraine in 2014.

After confirming that two of the turbines had been delivered to Crimea nearly two weeks ago, Siemens announced that it had launched legal proceedings against the individuals responsible.

Siemens said it had received "credible information" that its turbines had been diverted from the original destination.

Siemens said the diversion of the turbines constituted a "blatant breach of delivery contracts, trust and European Union regulations".

Dmitry Peskov, Putin's spokesman, declined to comment when asked by Reuters on Friday whether that was true.

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Economy and energy minister Sigmar Gabriel, a Social Democrat who is also vice chancellor, said at the time he "found the scene a bit off-key" given the need for German companies to uphold European values when doing business in Russian Federation.

Reuters said at the time the delivery might have taken place without Siemens' knowledge, which the company has since confirmed.

Munich-based multinational Siemens has been active for 170 years in Russian Federation, where its primary activities are supplying energy equipment and rail technology.

Its business there has slowed in recent years as the Russian economy was hit by falling oil prices and the impact of sanctions.

Siemens stock traded down almost 2% premarket.