Zastava, Remington deal may change

Zastava Arms and U.S. gunmaker Remington may have to change their cooperation deal, it was annouced Monday. A recent change in the ownership structure of the U.S. company through whom Zastava Arms has been exporting hunting rifles for the past two years to the U.S., Canada and Mexico, might affect their partnership. Zastava, Remington deal may change Zastava Arms workers’ union said it was not yet known whether the business cooperation contract on exports in 2008 would be signed by December. On Monday, the Kragujevac-based factory’s acting director, Zoran Aleksic, said that cooperation with Remington had not come into question. “Even though our factory has not yet received an order for next year’s exports, we expect to sign the deal by December,” he said. “Our team of experts will visit our American partners with a view to determining the amount of end-products we will have to deliver next year,” Aleksic said. However, union representatives do not agree with this, stressing that the change in their U.S. partners’ ownership structure will have consequences for the deal. “The new owner is asking for new products whose manufacture we have not yet mastered, even though we have new computerized equipment for gun assembly. We still don’t have enough time to produce what our partner is asking for,” Union President Jugoslav Ristic says. He added that the existing contracts offer no protection to the Kragujevac factory. “In a situation like this, where we have no idea of how many guns we will have to deliver next year in order to be able to launch their production now, the partner should pay penalty fines to our factory since it is he who contracted our capacities,” explains Ristic. Aleksic said that samples of stainless steel rifles produced in Zastava using Remington technology were sent to the partner company for inspection, and a shipment of 6,000 rifles ordered at the beginning of this year will soon be exported. Zastava Arms and Remington signed the business agreement in October 2005, according to which the U.S. gunmaker will sell Zastava’s sporting and hunting rifles programs in the U.S., Mexican and Canadian markets. The two producers also agreed to jointly develop new models of sporting guns, exchange experience and introduce technical and technological innovations. Both in 2005 and 2006, the two companies signed an annex to the agreement containing a precise amount of exports of hunting rifles for the following year. Zastava Arms has exported 42,000 hunting rifles worth USD 6.5mn to the U.S. in 2006 and 2007. The new majority owner of Remington is the Celebrus Group investment fund. Zastava workers believe the fund to be owned by U.S. President George Bush himself.

Zastava, Remington deal may change

Zastava Arms workers’ union said it was not yet known whether the business cooperation contract on exports in 2008 would be signed by December.

On Monday, the Kragujevac-based factory’s acting director, Zoran Aleksić, said that cooperation with Remington had not come into question.

“Even though our factory has not yet received an order for next year’s exports, we expect to sign the deal by December,” he said.

“Our team of experts will visit our American partners with a view to determining the amount of end-products we will have to deliver next year,” Aleksić said.

However, union representatives do not agree with this, stressing that the change in their U.S. partners’ ownership structure will have consequences for the deal.

“The new owner is asking for new products whose manufacture we have not yet mastered, even though we have new computerized equipment for gun assembly. We still don’t have enough time to produce what our partner is asking for,” Union President Jugoslav Ristić says.

He added that the existing contracts offer no protection to the Kragujevac factory.

“In a situation like this, where we have no idea of how many guns we will have to deliver next year in order to be able to launch their production now, the partner should pay penalty fines to our factory since it is he who contracted our capacities,” explains Ristić.

Aleksić said that samples of stainless steel rifles produced in Zastava using Remington technology were sent to the partner company for inspection, and a shipment of 6,000 rifles ordered at the beginning of this year will soon be exported.

Zastava Arms and Remington signed the business agreement in October 2005, according to which the U.S. gunmaker will sell Zastava’s sporting and hunting rifles programs in the U.S., Mexican and Canadian markets.

The two producers also agreed to jointly develop new models of sporting guns, exchange experience and introduce technical and technological innovations.

Both in 2005 and 2006, the two companies signed an annex to the agreement containing a precise amount of exports of hunting rifles for the following year.

Zastava Arms has exported 42,000 hunting rifles worth USD 6.5mn to the U.S. in 2006 and 2007.

The new majority owner of Remington is the Celebrus Group investment fund. Zastava workers believe the fund to be owned by U.S. President George Bush himself.