Agriculture, Latvia, Legislation, Markets and Companies, Mergers and take-overs

At the moment, Latraps owns 32% of shares in Latvijas piens, and Trikata KS – 53.7%.

Latraps Director General Edgars Ruza said that his company had offered to buy Trikata KS stake in Latvijas piens about a month ago, and if Trikata KS accepted the offer, a lot could change for the better.

In the meantime, Trikata KS is waiting for more offers. Latvijas piens council chairman Valdis Siksnis, a former banker, is also involved in looking for new investors in the company.

Latraps became a shareholder in Latvijas piens a year ago. "The company was being reorganized when we became shareholders. Overall, we believe it to be a viable project, and that is why we have invested our money in it," said Ruza.

He went on to say that Latvijas piens was currently honoring its obligations. Furthermore, there are plans to expand Latvijas piens operations, which is why new investors are being looked for.

As reported, Trikata KS is selling its shares in Latvijas piens as the latter owes more than EUR 3 million for milk it has been supplied, Trikata KS CEO Uldis Krievars told LETA after the company's board meeting on Monday.

Latvijas piens has not been paying for milk for a long time, and its debt continues to mount. "At the moment, the debt is at EUR 3,036,600, and talks with the company have not achieved anything," said Krievars.

According to unofficial information, the prospective buyers of Trikata KS shares in Latvijas piens are from Estonia, Lithuania, or Ukraine. One of the largest agricultural companies in Latvia is also among the prospective buyers.

LETA also reported that on May 20, Trikata KS turned to Valmiera District Court requesting a legal protection process, whereas the court gave Trikata KS time until July 21 to prepare its legal protection plan and harmonize it with the cooperative's creditors.

Before that, May 14, Vipulka County farmstead "Kalnbrindas" filed an insolvency claim against Trikata KS, stating that the cooperative owed the farm EUR 10,000, and that it was also indebted to other farmers in Latvia. Trikata KS settled its liabilities to the farm on May 22.

Trikata KS head Krievars told LETA previously that his company's problems with paying suppliers were due to Latvijas piens failures to timely settle its liabilities to Trikata KS. Latvijas piens CEO Anita Skudra told LETA nevertheless that the company's operations were stabilized at the end of last year.

According to Firmas.lv, Trikata KS turnover in 2013 totaled EUR 25.9 million, up from EUR 25.5 million in 2012. The company posted EUR 15,227 in losses in 2013, compared to a loss of EUR 688,063 in 2012. The company has not yet released its financial data for 2014.

Construction of Latvijas piens dairy plant began in September 2011. Trikata KS provided EUR 1.42 million for the project, approximately EUR 9.24 million was borrowed from banks, and the European Union's funding for the project totaled EUR 4.26 million.

According to "Firmas.lv", the current owners of Latvijas piens are Trikata KS with 53.66%, Dzese with 20.94%, Latraps with 19.62%, and VAKS with 5.87%.

Latvijas piens began operations at the end of 2012, the company produces cheese, skimmed milk concentrate, and sour cream. The company's products are exported to Lithuania, Estonia, Ukraine, Germany, Slovakia, Great Britain, Israel.

According to preliminary data, Latvijas piens turnover last year totaled EUR 28.33 million, compared to EUR 37.21 million the company turned over in 2013.