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International Internet Magazine. Baltic States news & analytics Friday, 06.12.2019, 01:18

Estonian garment seller Baltika to increase share capital by EUR 5 mln

BC, Tallinn, 15.03.2019.Print version
The listed Estonian garment seller Baltika is to make a proposal for the issue of new shares in the amount of 5 mln euros to the general meeting of shareholders, reported LETA/BNS.

The supervisory board of AS Baltika approved the 2019 and 2020 operational plan. One-off costs related with the approved operational plan amount to nearly 2 mln euros, which will be recognized in the annual report for 2018, the company told the stock exchange.

The amount of equity of AS Baltika in 2018 after the one-off costs is 67,000 euros and it no longer complies with the requirement set out in the Commercial Code. In order to comply with the law, equity has to be at least 2,040,000 euros.

For the implementation of the 2019–2020 operational plan and in order to meet the net asset requirement set out in the Commercial Code, the supervisory board of Baltika decided to present to the general meeting of shareholders the proposal to increase the nominal value of the share to 1 euro and to exchange the existing shares so that for each 10 shares one new share is given, thereafter decrease the nominal value of the share to 0.10 euros and decrease share capital from 4,079,000 euros to 408,000 euros to cover the losses. 

Additionally, it was decided to propose to the general meeting of shareholders to increase in August 2019 the share capital by 5 mln euros via public offering. KJK Fund, Sicav-SIF, the largest shareholder of AS Baltika, is ready to subscribe the new shares.

The supervisory board also gave the consent to the management board to take a loan of 3 million euros from KJK Fund SICAV-SIF in the next 2 months. The proposed loan will be interest bearing and short-term, with maturity in August 2019.

By the decision of the supervisory board, Mae Hansen will be the third member of the management board of AS Baltika as of March 22, 2019. She will be responsible for implementing the above mentioned 2019–2020 operational plan. Meelis Milder and Maigi Parnik-Pernik continue as members of the Management Board of AS Baltika.

Baltika last year had to accept a 3.1 mln euro net loss. In twelve months total, Baltika's sales revenue decreased by 6% and was 44.7 mln euros. Baltika CEO Meelis Milder said that the company must radically change its business model and focus on reducing expenses.

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