EU – Baltic States, Financial Services, Latvia, Legislation, Markets and Companies, Metals Market

To protect its interests, Polcopper Sp plans to turn to the European Union's institutions. Polcopper Sp is "unpleasantly surprised" at the latest developments regarding Liepajas metalurgs and will try to defend its interests at all possible levels. The company will try to prove it is right, if not in Latvia, then in Europe, as Polcopper Sp Sales Manager Sergiy Makogon points out in an interview with Dienas Bizness.

Polcopper Sp believes that Liepajas metalurgs legal protection plan is being implemented without a legal basis, since a part of Liepaja Court's decision does not correspond to the Civil Procedure Law. Polcopper Sp also wants Liepajas metalurgs declared insolvent, as it believes that it will benefit more from Liepajas metalurgs insolvency than from implementing Liepajas metalurgs legal protection plan.

The newspaper reports that other Polish companies, in cooperation with the Polish Embassy, are also trying to join efforts to recover Liepajas metalurgs’ debts due to "violations in the Latvian-Polish agreement on legal protection."

Liepajas metalurgs owes EUR 700,000 to Polcopper Sp.

Liepajas metalurgs’ shareholders and board decline to comment on the conflict. Liepajas metalurgs board member Ainars Kreics points out that the "very concept of Polcopper Sp's"protest is a mistake", since Liepajas metalurgs’ unsecured creditors will receive nothing in case of insolvency.

As reported, Liepajas metalurgs has halted production. In July, the State Treasury repaid from the state budget the principal amount of the loan owed to the Italian bank UniCredit by Liepajas metalurgs – EUR 67,465,056 or LVL 47,414,711.

The Liepaja Court has accepted Liepajas metalurgs legal protection plan, drafted by the company's specialists. The plan has been harmonized with all secured and more than 55 percent of unsecured creditors.

As part of the legal protection process, approved by the Liepaja Court, Liepajas metalurgs plans to take measures to increase production and sales volumes, focusing on markets in the vicinity of Latvia that offer better prospects. The legal protection process plan also stipulates more professional market analysis at the company so the company could plan flexible sales and higher profits. In order to ensure additional incomes during implementation of the plan, Liepajas metalurgs is planning to sell assets that are not part of the company's main business for at least LVL 3,765,000.