Norway's suspension of engine maker sale a 'serious concern', Russia embassy says

OSLO, March 10 (Reuters) - Norway’s decision to suspend the planned sale of a maritime engine maker to Russia’s TMH Group is a matter of “serious concern” and suggests possible anti-Russian sentiment, the Russian embassy in Oslo told Reuters.

Norway on Tuesday ordered Britain’s Rolls-Royce Holdings to pause the sale of Bergen Engines to TMH while the government assesses national security implications for its navy and the civilian sector.

“(TMH) is a well-known major private company that has quite a number of international assets and has been working in the international market for a long time,” the Russian embassy said in a statement to Reuters.

“The ongoing discussion in Norway with anti-Russian implication in this connection causes serious concern,” it said.

Rolls-Royce last month announced a 150 million euro ($178 million) agreement to sell the Norwegian maker of gas and diesel engines for marine use and power generation.

Bergen Engines is a supplier to NATO member Norway’s navy.

The transaction now faces scrutiny by Norway’s NSM security agency in coordination with other government bodies.

“We are looking at undesirable transfers of technology and knowledge,” Defence Minister Frank Bakke-Jensen of Norway’s Conservative Party told public broadcaster NRK on Wednesday.

He added however that stopping a transaction would be a serious intervention in an agreement between two companies, and that Norway remains committed to rules-based international trade.

Relations between Norway and Russia, which share a border in the Arctic, gradually improved in the post-Cold War era before suffering a setback when Moscow annexed Crimea in 2014.

That triggered more tension in the north with a military build-up on both sides and more frequent manoeuvres.

If the sale of Bergen Engines goes ahead, the navy would likely have to seek new suppliers, Norway’s chief of defence, General Eirik Kristoffersen, told private broadcaster TV2.

“If there’s a Russian company owning a Norwegian firm from which we are to receive deliveries, we can’t take such deliveries,” Kristoffersen said.

TMH Group on Tuesday said it would cooperate with Norwegian authorities and it was hopeful of completing the transaction.

$1 = 0.8420 euros Reporting by Terje Solsvik and Nerijus Adomaitis; editing by Jason Neely