Transport

International Internet Magazine. Baltic States news & analytics Wednesday, 21.08.2019, 18:04

If BAS fails to honor liabilities, it will have to sell its stake in airBaltic to state for one lat

Alla Petrova, BC, Riga, 29.11.2011.Print version
If Baltijas Aviacijas sistemas (BAS), the private shareholder in the national airline airBaltic, fails to provide a loan to the airline as it has agreed to, BAS will have to sell all of its airBaltic shares to the state for one lat, as provided for in the airBaltic shareholders' agreement.

A copy of a report on the secret agreement between the airBaltic shareholders and creditors that has been obtained by "Pietiek.com" stipulates that if BAS fails to honor its liabilities, airBaltic creditors will also have to sell all their claims on the airline and BAS to the state for one lat, writes LETA.

 

"Public joint-stock companies have been forced to sign an agreement which states clearly that, if BAS is unable to honor its liabilities, the banks will sell all their claims on airBaltic to the government for one lat. We are still trying to determine the total amount, but it appears to be over EUR 100 million. Of course, neither [Prime Minister Valdis] Dombrovskis, nor [former majority owner of Lithuanian Snoras bank Vladimir] Antonov have not reported this unaccounted-for liability to neither [Financial and Capital Market Commission's head Irena] Krumane, nor to the Lithuanian authorities, although it is clear that if this happens, both banks will immediately lose that capital," says the report posted at "Pietiek.com" today. It appears that the report has been drawn up by some law offices and it deals with the current developments in Latvia.

 

As reported, BAS was unable to state clearly during the airline's shareholders meeting if it had the necessary funds for airBaltic share capital increase, as Transport Ministry State Secretary Anrijs Matiss told reporters after the meeting yesterday. BAS has time until December 15.

 

If BAS fails to make the investment it has to make, the proportions of shares held by BAS and the state will change. It has not been decided yet if the state will invest LVL 37 million in airBaltic share capital instead of BAS.

 

If the state decides against investing money in the airline in BAS stead, airBaltic development plans will have to be revised.

 

The investment that the state has to make in airBaltic share capital is LVL 41.6 million.

 

As reported, the agreement on increasing airBaltic share capital, signed by the airline's shareholders on October 3, stipulates that the state and Baltijas Aviacijas sistemas (BAS) would jointly invest EUR 153 million (LVL 107.1 million) into the airline's share capital. The agreement was also signed by the airline's creditors including the Lithuanian bank Snoras and Latvijas Krajbanka.

 

As already reported, around LVL 100 million is missing at Krajbanka, which is why the Financial and Capital Market Commission has halted the bank's operations. Hence the uncertainty about the ability of BAS to honor its liabilities regarding the airBaltic share capital increase.






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