Business, Estonia, Markets and Companies

GILD Fund Management is the fund manager of Estonia's hedge fund GILD Arbitrage.

"Although it's not a big loan issuer, GILD Fund Management hasn't been able to repay the loan despite repeatedly prolonged deadlines. Elgrande is of opinion that currently GILD Fund Management is insolvent, it's not temporary kind and there's a base to file a bankruptcy application," Ain Kalme, the Attorney at Law who represents Elgrande said.

As Kalme noted, GILD Fund Management claims to be in talks to convert big loans into bonds. Creditors would probably lose all the amount of they refused emission terms.

The Elgrande's claim against GILD is currently about 1.2 million kroons worth.

Tonno Vahk, the Fund Manager of GILD Arbitrage, said that Elgrande is the blackmailer.

"Elgrande is the blackmailer, who tries to get the better position with the media's help and stop the fund's bond issue," Vahk said.

According to the representative of GILD Arbitrage, the bankruptcy application is legally baseless and harming interests of creditors, including Elgrande.