Financial Services, Investments, Latvia, Transport

The share capital increase has been added to the agenda of the extraordinary shareholder meeting to be held on September 19 at the request by majority shareholder, Vitol Netherlands B.V. (Vitol).

The shareholder meeting is expected to approve the proposal for increasing the company's share capital by EUR 60 million to EUR 120 million by issuing new shares in the closed (non-public) share issue with the aim to refinance shipping debt.

In the first half of this year, Latvijas Kugnieciba group reported a turnover of EUR 43.69 million, down 3 percent year-on-year, and earned a profit of EUR 8.597 million as opposed to a loss during the same period in 2016.

As a result of the mandatory buy-out offer which expired on August 15, Vitol has acquired additional 34,501,729 shares in Latvijas Kugnieciba or 17.25 percent, increasing its stake in the shipping company to 181,583,159 shares or 90.79 percent.

By the decision of the Latvian government, state-owned shares in Latvijas Kugnieciba were also sold to Vitol under the mandatory buyout offer. The government received EUR 14.2 million for its 10-percent stake in the shipping company. The Latvian Privatization Agency (LPA) as the holder of the state-owned share said that the decision to sell the shares was made due to the fact that, as a minority shareholder, the Latvian state could not influence decision-taking and management of the shipping company. Moreover, no dividends had been paid to shareholders since privatization of Latvijas Kugnieciba in 2002.

The share capital of Latvijas Kugnieciba comprises 200 million shares with nominal value of EUR 0.3 per share.

Latvijas Kugnieciba provides shipping services in all seas and oceans of the world, trains and recruits crews, as well as provides technical ship management to its own and ships owned by other companies.

Latvijas Kugnieciba is quoted on the Main List of the Nasdaq Riga stock exchange.