Siemens sells stake in Russian firm after Crimea turbine scandal

German engineering giant Siemens has said it will exit a joint venture with Russian Federation over a Crimean sanctions scandal.

Siemens also said it is halting deliveries of power generation equipment to Russian state-controlled entities while it figures out how to prevent this from happening again.

"Rosneft did not receive notifications from Siemens about the suspension of cooperation on previously signed agreements", the official said.

The diversion was "against clear contractual agreements", and constituting a "blatant breach of Siemens' delivery contracts, trust and European Union regulations", Siemens said.

The company announced having got valid information about the turbines illegally delivered to Crimea against sanctions.

Siemens intends to reject its share in the joint venture with Russia Technopromexport - the Interavtomatika company, Reuters reports.

Economy and energy minister Sigmar Gabriel, a Social Democrat who is also vice chancellor, said at the time he "found the scene a bit off-key" given the need for German companies to uphold European values when doing business in Russian Federation. A Kremlin spokesman declined to comment Friday during a regular briefing with reporters.

Munich-based multinational Siemens has been active for 170 years in Russian Federation, where its primary activities are supplying energy equipment and rail technology.

The EU imposed sanctions on Russian Federation after its annexation of the Black Sea peninsula from Ukraine in March 2014. It is also pursuing legal actions meant to halt any other deliveries to Crimea and ensure that any equipment that has already been shipped is returned to its original destination.

  • Eleanor Harrison