Erik Prince, a private security contractor and informal adviser to United States President Donald Trump, is in talks to acquire the Motor Sich public joint-stock company, Ukraine’s largest manufacturer of aircraft engines.
The Interfax Ukraine news agency reported this, citing the Wall Street Journal, which cited United States officials briefed on the matter.
According to the Wall Street Journal, the Trump administration has approached Prince and at least one other potential buyer from the private sector about Motor Sich and Prince has discussed the company with Ukrainian officials and visited the company’s main plant.
The newspaper noted that the United States’ Chargé d'Affaires in Ukraine William Taylor and the United States Defense Department’s senior defense-industry adviser on Ukraine Donald Winter visited Motor Sich in late September.
According to the Wall Street Journal, Prince, a former Navy SEAL and billionaire founder of the defense contractor formerly known as Blackwater, is the executive director and deputy chairman of Frontier Services Group (FSG), a Hong Kong- and Beijing-based private security contractor listed on the Hong Kong stock exchange. CITIC Group Corp., a Chinese state-controlled investment fund, is FSG’s largest shareholder with a 25.91% stake as of the end of 2018. Prince is the brother of the Trump administration’s Education Secretary Betsy DeVos.
Prince has other business interests outside China and has traveled to Ukraine a number of times, visiting at least nine times since the start of 2014, the Wall Street Journal reports, citing Ukrainian immigration records.
According to the Wall Street Journal, Prince declined to comment, but a spokesperson for Frontier Services Group and Prince confirmed that he is “looking to invest in” Ukraine. The spokesperson added that any business activities that Prince might be exploring in Ukraine were entirely independent of any government. Motor Sich did not immediately respond to requests for comment. A Ukrainian government official declined to comment, citing national-security concerns.
As the Wall Street Journal further reported, the United States has been searching for a buyer and other support for Motor Sich, and the Trump administration has also discussed a Motor Sich purchase with Ukrainian-born Max Polyakov, the owner and director of Texas-based Firefly Aerospace Inc., which manufactures and operates space-launch vehicles.
As the CFTS portal reported, on June 7, the government of Ukraine (represented by the Ukroboronprom state defense concern), the Skyrizon company (China), and the Xinwei Group (China) jointly applied to the Antimonopoly Committee of Ukraine to authorize Skyrizon and Xinwei for permission to acquire more than 25% and 50% of the shares in Motor Sich, respectively, and jointly manage and control the company with Ukroboronprom.
The relevant package of agreements was signed on June 19. The package of agreements, which was also submitted to the Antimonopoly Committee for examination, will enter into force automatically if the antimonopoly committee approves the deal.
The Antimonopoly Committee of Ukraine announced in early July that it had begun considering the proposed deal and that it would accept comments and proposals until July 22, but the committee has not yet announced its final decision.
It was reported in late August that the United States was trying to block China’s pending acquisition of the Motor Sich because it believes that this deal could give China important defense technology.