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Russia RusPromAvto mulls Ikarus plant - paper

MOSCOW, Feb 19 (Reuters) - Russian auto holding RusPromAvto may buy one of Ikarus' two bus plants in Hungary in a $10 million deal to move into Eastern European markets, Vedomosti newspaper quoted a source at the firm as saying.

Ikarus' Szekesfehervar factory in central Hungary has a capacity of a few thousand vehicles a year, but there are only 200 orders on the books for 2004, and the firm's Fiat-controlled owner Irisbus has decided to close or sell the plant, the newspaper reported.

"No decision has been taken yet," the source said. "(RusPromAvto) is simply taking a look at the enterprise."

RusPromAvto itself said it had no acquisition plans abroad, but saw the potential for purchases in the future.

RusPromAvto, controlled by prominent businessman Oleg Deripaska's Basic Element group, holds 79 percent of the Russian bus market and produced around 14,700 buses in 2003.

Analysts value any deal for the Szekesfehervar plant at around $10 million, and say RusPromAvto would be interested in Ikarus only as an entry vehicle into Eastern Europe.

Russia was formerly a major market for Soviet-era Ikarus buses, but orders dried up in 2002.