Financial Services, Foodstuff, Latvia, Legislation, Markets and Companies

On the other hand, Valmiera District Court told LETA that Trikata KS had not submitted its legal protection plan by the deadline, therefore the court could consider continuing the insolvency process against Trikata KS in the near future already.

As reported, on May 20 Trikata KS turned to Valmiera District Court requesting a legal protection process, whereas the court gave Trikata KS time until July 23 to prepare its legal protection plan and harmonize it with the cooperative's creditors.

Trikata KS will continue work and try to retrieve money from Latvijas piens and sell its 53.66% stake in the company so it could pay farmers for milk supplied as soon as possible. The cooperative's management continues talks with prospective buyers of the shares," said Krievars.

The cooperative society is also continuing talks with another Latvijas piens shareholder, the cooperative society Latraps, to agree on an "adequate price for the shares".

"The current offer from Latraps is unfair to the other Trikata KS creditors. At the same time, there are other offers, which are more advantageous and would enable us to pay farmers immediately," said Krievars.

Agriculture Minister Janis Duklavs (Greens/Farmers) said yesterday that Trikata KS would have to reply other Latvijas piens shareholders as soon as possible regarding the acquisition of Trikata KS shares in Latvijas piens.

"I met with the management of Latvijas piens, Latraps and VAKS to learn their opinion about the current situation. The latter two said they were prepared to buy Trikata KS shares in Latvijas piens. Trikata KS should say in a few days whether it accepts the two cooperative societies' offer or not," said Duklavs.

LETA also reported, Edgars Ruza, Director General at the cooperative society Latraps, said that Latraps had repeatedly offered to buy Trikata KS shares in Latvijas piens. Ruza declined to reveal how much Latraps was willing to pay for the shares.

According to Latvijas piens CEO Anita Skudra, the company continues operations as per usual, regardless of its complicated relations with the largest shareholder in the company, Trikata KS. She also said, however, that Latvijas piens had sent a letter to the State Treasury asking for a six-month tax holiday.

Trikata KS is selling its 55.36% of shares in Latvijas piens as the latter owes more than EUR 3 million for milk it has been supplied, Trikata KS CEO Krievars told LETA after the company's board meeting on Monday.

According to unofficial information, the prospective buyers of Trikata KS shares in Latvijas piens are from Estonia, Lithuania, or Ukraine. The Paskausks family, the owners of one of the largest agricultural companies in Latvia Agrolats Holdings, could also among the prospective buyers.

Latvijas piens has offered Trikata KS a new debt repayment schedule and, in addition, is prepared to put up the "Trikata" brand, currently part of the company's share capital with nominal value of approximately EUR 2 million. If Latvijas piens is unable to honor its obligations to Trikata KS, the latter will have the right to sell the brand.

On 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.

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.