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Potential buyer of KVV Liepajas Metalurgs increases share capital to EUR 7.5 mln

BC, Riga, 13.10.2017.Print version
K-1 Liepajas Metalurgs Plant, the new stock company reportedly established to take over Latvia’s insolvent steel company KVV Liepajas Metalurgs, increased its share capital from EUR 35,000 to EUR 7.535 million this week, according to information available at Firmas.lv, cites LETA.

The company’s share capital has been increased by issuing 7,500,000 bearer shares with the face value of EUR 1. Luxembourg-registered company Kalior Invest SA has subscribed to 6,000,000 or 80% of these shares and the Swiss-registered Trasteel Trading Holding SA to 1,500,000 or 20% of the shares. The share capital has to be paid up by October 16.

 

According to unconfirmed information obtained by LETA, K-1 Liepajas Metalurgs Plant is a legal entity established to take over the assets of KVV Liepajas Metalurgs.

 

Israeli citizen Igor Shamis, the sole board member of KVV Liepajas Metalurgs, is the buyer of KVV Liepajas Metalurgs steelworks, according to information obtained by LETA. The company’s supervisory board is chaired by Russian citizen Dmitry Baranov. Other members of the supervisory board include Swiss citizen Gianfranco Lauro Carlo Imperato and Latvian citizens Iveta Tile and Gunta Ziverte.

 

Upon registration, K-1 Liepajas Metalurgs Plant had a share capital of EUR 35,000. According to information from Firmas.lv, Shamis provided EUR 27,700 of the company’s share capital, Swiss company Trasteel International SA contributed EUR 7,000 and Latvian citizen Nadezda Malinovska paid EUR 300 on Shamis’ behalf.

 

As reported, the plan is to sell off the ailing company by October 16. All the necessary documents are now being processed and agreed with the potential buyer. After that, the company’s secured creditors will be asked to approve the deal.

 

According to unconfirmed information obtained by LETA, the buyer of KVV Liepajas Metalurgs is Shamis who three years ago was one of the main bidders for the steelworks’ assets. The company was then sold to Ukraine’s KVV Group.

 

In 2014, United Group, a Luxembourg-registered company owned by Shamis, offered to acquire the Liepajas Metalurgs plant for EUR 120 million, while KVV Group, the winning bidder, offered EUR 107 million.

 

As reported, Economics Minister Arvils Aseradens (Unity) said in May that six potential investors had submitted non-binding offers and the government has given the green light to further negotiations. Aseradens voiced cautious optimism about chances of re-launching the steelworks.

 

The Liepaja Court declared KVV Liepajas Metalurgs insolvent on September 16, 2016.

 

The government in May 2016 rejected the debt restructuring proposals by KVV Group, the Ukrainian owners of KVV Liepajas Metalurgs, saying that the proposals envisaged significant participation of the Latvian state in the metallurgical company without handing over control over the company, tax discounts and other measures that might be interpreted as unlawful state aid.

 

The government also authorized the Latvian Privatization Agency (LPA) to establish a company, FeLM, to which the State Treasury will assign its claim against KVV Liepajas Metalurgs. The steel plant owes EUR 65 million to the Latvian state.


Liepajas Metalurgs metallurgical plant based in the Liepaja port city in south-western Latvia was first declared insolvent after it failed to repay a state-guaranteed loan to an Italian bank. The government sold the plant to Ukrainian investors, KVV Group, in late 2014.

 

Liepajas Metalurgs was renamed KVV Liepajas Metalurgs and officially re-opened on March 6, 2015, but soon started having problems again. The company had difficulties paying its electricity bills and wages to workers. It also missed the deadline for a EUR 2.7 million payment to the Latvian state, an installment for purchase of the steel plant.






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