Financial Services, Latvia, Markets and Companies, Railways, Transport

Finance Ministry spokesman Aleksis Jarockis said that the ministry had received DLRR requests for assistance in the form of a state guarantee on October 24 and November 2 this year.

He pointed out that, under the effective law, state guarantees may not be issued to private companies such as DLRR.

Nevertheless, the representatives of the Finance Ministry and DLRR will meet in early December to discuss the situation.

As reported, DLRR, the train engine repair group based in the southeastern Latvian city of Daugavpils, has asked for a state guarantees to get a bank loan. The company said in a statement to the Nasdaq Riga stock exchange that it had failed to reach an agreement with Swedbank regarding extension of credit agreements terminating this year and potential default of liabilities towards the bank. The bank's refusal has been caused by the financial situation in the plant and the lack of confidence of the bank regarding increase of order volumes. DLRR said the difficult situation in relations between Russia and the EU led to sharp decrease of orders from the Russian market.

The largest shareholders DLRR are Estonia's Skinest Rail (47.97%) and Estonia's Spacecom (25.27%), which belongs to the Russian transport group Severstaltrans.

DLRR is quoted on the Nasdaq Riga Secondary List.