Ukraine seizes stakes in ‘strategic’ companies for war effort

The Ukrainian government says it has invoked wartime laws to take control of stakes in several “strategically important” companies in order to guarantee sufficient supplies for its military to fend off the invasion of Russia.

Defence Minister Oleksii Reznikov on Monday announced the requisition of a leading engine maker and four other energy and manufacturing enterprises from some of the country’s richest men.

He did not elaborate on the size of the stakes that had been taken over but said the assets of the five companies would be managed by his ministry to meet “urgent” military needs.

“This is about providing fuel and lubricants, repairing military equipment and weapons,” Reznikov told a news conference, alongside Prime Minister Denys Shmyhal and Oleksiy Danilov, secretary of Ukraine’s national security and defence council.

There was no immediate comment by any of the five companies.

During the conference, Shmyhal said the companies being taken under state control make products or provide services that are “critical” for Ukraine’s defence and energy needs.

“These enterprises must operate 24 hours a day, seven days a week for the needs of the state’s defence,” he said.

The announcement comes as Russia unleashed a barrage of air raids on Ukrainian cities in recent weeks, damaging some 40 percent of Ukraine’s energy infrastructure.

It was the first time the government had used martial law for such a move since Russia invaded Ukraine in February. It is also the most dramatic wartime intervention into big business, affecting companies linked to tycoons whose political power Ukraine President Volodymyr Zelenskyy’s team has long sought to curb.

The enterprises include aircraft engine manufacturer Motor Sich working from the partially Russian-controlled region of Zaporizhia, Danilov told the news conference in the capital, Kyiv.

“After martial law is lifted, these assets may be returned to their owners or their value may be reimbursed,” Danilov added.

The other energy and manufacturing companies include Zaporozhtransformator, AvtoKrAZ and the oil and gas company UkrNafta.

The decision was taken at a meeting of top security officials chaired by Zelenskyy on Saturday and went into effect on Sunday.

The companies are partially owned by the state and are associated with powerful businessmen, including billionaires Ihor Kolomoisky and Kostiantyn Zhevaho, as well as businessman Vyacheslav Bohuslayev, who was arrested in October on suspicion of collaborating with Russia.

“This is not nationalisation,” Reznikov said. “This is a direct taking over of assets during wartime. These are totally different legal forms.”