One of the largest chip manufacturers has been declared bankrupt in Russia

8 December, 2024 The main entrance to the Angstrom factory. Photo: Angstrom Angstrom-T, one of the largest manufacturers of chips for military use, has been declared bankrupt in Russia.

The Moscow Times reported on this. According to a court decision, on December 2, 2024, the company was declared bankrupt due to the inability to repay a £9.9 million debt. The creation of Angstrom-T was driven by the Russian government's desire to develop the production of competitive microchips for export to Europe and other countries, as well as for the domestic market.

Chip production at the Angstrom plant.

Photo credits: Angstrom

The company was planned to become Russia's largest microchip manufacturing plant for the civilian and military sectors. The plant was run by Leonid Reiman, former Minister of Communications, who is close to Russian President Vladimir Putin and has served as the president's advisor from 2008 to 2010. Thanks to such ambitions, the plant received £1 billion in government funding to implement its plans at the beginning of its operations.

Additionally, the company received a EUR815 million credit line from Vnesheconombank to develop and manufacture processors, smart cards, and electronic passports. However, due to its difficult financial situation and lack of funds, the company found itself in an even more difficult position year after year, unable to repay its loans. As a result, by January 2019, Vnesheconombank seized all of the plant's equipment and shares and filed for bankruptcy.

Production of microelectronics.

Illustrative photo

It should be noted that, in addition to the difficult financial situation, the company has been under US sanctions since 2022 because it was engaged in producing military navigation systems. Canada, Japan, Switzerland, and Ukraine also imposed sanctions. Angstrom was transferred to the management of the state defense corporation Rostec to maintain minimal chip production capabilities and attempts to create import-substituting products.

Militarnyi previously reported that Russia was purchasing machines for microelectronics production under sanctions.

Despite the long-standing policy of import substitution introduced by the Russian government long before the full-scale invasion of Ukraine, the Russian defense industry has remained dependent on Western-made machines and equipment.

In particular, the evidence is the scale of shadow imports.