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Snaige fined for failing to act in interests of all shareholders

BC, Vilnius, 05.02.2018.Print version
The Bank of Lithuania, which supervises financial market participants, has imposed a fine of over 207,000 euros on the refrigerator manufacturer Snaige, saying that the company failed to act in its own interests and in the interests of all of its shareholders, informs LETA/BNS.

"The essence of the infringement is that Snaige's managers failed to take into account the interests of the company itself and its minority shareholders," Vytautas Valvonis, director of the central bank's Supervision Service, said in a press release on Friday.

"The company violated the provisions of the Law on Securities and disregarded our instructions to rectify the irregularities," he added.

According to the Bank of Lithuania, companies related to Russia's Polair Group, Snaige's majority shareholder, since mid-2012 have not been paying interest on loans, totaling 11.92 million euros as of Sept. 30, 2017, provided to them by Snaige. The money is not used for the company's needs and for the benefit of all of its shareholders. Also, Snaige has taken out a loan for the benefit of companies related to the majority shareholder and is paying interest on the loan from its own resources.

In violation of international accounting standards, Snaige used a part of its revaluation reserve to cover accrued losses, thus reducing the reserve by 3.17 million euros. Nevertheless, the management board proposed to pay dividends to shareholders. Some 0.87 million euros, or 91.1% of the total dividend payment, went to companies related to Polair, the central bank said.

Snaige will have to rectify the breaches, it added.

The refrigerator producer, which is quoted on the Secondary List of the Nasdaq Vilnius stock exchange, posted 244,000 euros in consolidated net losses for the first three quarters of 2017 as its consolidated revenue for the period fell by 2.3% to 30.787 million euros.

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