Defence Ministry silently acquires arms factory

WHILE Defence Minister Martin Glváč has offered three military companies for rent to private entities, he has recently acquired a new one.

Defence Minister Martin GlváčDefence Minister Martin Glváč (Source: TASR)

The ministry silently took control over firms united in DMD Group from Dubnica nad Váhom (Trenčín Region) from the National Property Fund (FNM) in July. The company reported a loss of more than €1.2 million last year, the Sme daily reported.

“The transfer of DMD Group shares to the Defence Ministry pertains to FNM’s abolition whose activities will end on December 31, 2015,” ministry spokesperson Martina Balleková told Sme.

DMD Group owns 50-percent stock in ZVS Holding company, while the remaining shares are owned by Czech contractor Jaroslav Strnad. Strnad entered ZVS Holding in the beginning of the year. Experts predict that his links to the ministry may hinder some business in the future as there may be potential conflicts of interest.

The Defence Ministry has, however, already been trading with Strnad. He is, for example, linked to MSM Martin which together with Česká Zbrojovka should produce Bren rifles for the Slovak army, Sme wrote.

Analyst with the Central European Policy Institute (CEPI) Jaroslav Naď says that the relations between companies and the government should not raise suspicions of being vague. Thus he assumes that the ministry should not involve firms connected to Strnad in the new orders it has announced, as reported by Sme.

Strnad has not answered the daily’s questions.

Naď also considers the transfer of DMD Group a middle step. He suggests that the future government should rent the firm or find another way in which it could be entered by a private company, similarly to previous cases.

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