RIGA - An Estonian investment company last week announced that it has acquired a majority stake in Latvia's Lauma, one of the Baltics' largest textile producers and most well-known brand names.
Alta Capital, a three-year-old investment group, purchased a 76.4 percent stake in the lingerie manufacturer for an undisclosed price in a deal arranged by the Prudentia consultancy. Unofficial sources, however, said the price of each share was 3 lats (4.5 euros), or 13 million lats for the entire lot.
Alta purchased stakes belonging to Lauma President Zigrida Rusina (34.68 percent), Vice President Viktors Aispurs (34.31 percent) and a group of small shareholders (7.45 percent).
Rumors of a deal had been circulating for weeks, as it was known that Rusina and Aispurs invited Prudentia to help find a strategic investor.
"I have spent 35 years with Lauma, including the last two decades as the company's president -- the time has come to do something else," Rusina told reporters, adding that she would continue to work at the Liepaja-based company as a council member and adviser to the new management.
"Lauma is in good financial shape. All crises are behind us now, and the company is growing steadily. Sales and profit rise with each year, but new, fresh ideas are required for further growth," she explained. "I am sure that the new owners will continue to expand the business, making use of their professional skills and expertise and new ideas."
Officials from Alta Capital, which owns one of Estonia's largest textile producers, stressed their willingness to continue developing the brand-name company.
"It's too soon at this moment to speak about our plans concerning Lauma, but I can say that we hope to develop the company further," Alta Capital manager Andres Ratsepp told the Baltic News Service.
Firm partner Indrek Rahumaa said the new owners wanted "to develop the company and strengthen Lauma's brand and market positions using the company's current platform and cooperation with Western and Eastern markets."
Alta Capital was founded on private capital in 2001. Its biggest acquisition to date was 79 percent in Estonia's Klementi textile company two years ago. It is also a hotel and spa operator and has an interest in a construction company.
However, Klementi has been struggling since Alta Capital took over. Last year the company posted losses of 22.2 million kroons (1.42 million euros), though this was down from losses of 31.9 million kroons in 2002. Sales were largely flat at 133 million kroons.
In April Klementi opened a sowing factory in Stockholm and in May signed a deal on the distribution of its products in Denmark. It sells women's clothing under its own trademarks through nearly 200 distributors and stores across Scandinavia. The company announced that it was aiming to increase density of display and effectiveness of sales.
Regarding Rusina's replacement, one candidate named was Edgars Stelmahers, director and board chairman of beer maker Cesu Alus. Stelmahers spokesperson confirmed that Alta Capital had made such a proposal and that talks had been held.
Aispurs will continue as Lauma's vice president.
In 2003 the company's audited profit amounted to 2.5 million lats on a net turnover of 19.8 million lats. About 80 percent of Lauma's output is exported to more than 20 European countries.
