RIGA - The conflict among Ventspils business interests that has embroiled Ventspils Nafta spilled over to Latvijas Kugnieciba (Latvian Shipping, or Lasco) last week, as the company's board and executive council tried to negate each other's authority.
On Feb. 9 the board of directors voted to cancel a shareholders' meeting set for Feb. 11 in order "to avoid any lawful decisions from being taken." Board members feared that Ventspils Nafta's proposed amendments to Lasco's charter would harm minority shareholders. At a time when the company is undergoing a major fleet renewal that costs hundreds of millions of euros, the rights issue is particularly sensitive.
However, on Feb. 11 shareholders elected a new executive council, which in turn suspended the board's authority with the exception of the chairman, Imants Vikmanis.
Olga Petersone, deputy chair of Lasco's new council and chairwoman of Ventspils Nafta's board, declined to comment on when a new board would be nominated. "We will do everything to assess the board's performance as soon as possible," she said.
Shareholders elected Uldis Pumpurs as chairman of the new council.
The ousted council members decried the shareholders meeting and told journalists they intended to file a complaint in the courts. "Nine people pretending to be shareholders of Latvijas Kugnieciba have illegally convened a shareholders' meeting and tried to assemble a shadow council," said Oleg Stepanov, one of the ousted council members.
Stepanov, who heads Ventbunkers, is widely perceived as the central force of one of the two opposing camps in the conflict, the other being Ventspils Mayor Aivars Lembergs.
Stepanov appealed to government officials to prevent the further erosion of minority rights in Lasco. As a result of the shareholders' meeting, he said, Ventspils Nafta now has a monopoly of power in the company, which could undermine the shipper's plans to renew its tanker fleet.
He also warned that the shareholder revolt could ultimately lead to the company being sold to a strategic investor. "Oil transit won't give the concern's [Ventspils Nafta's] owners money, but Lasco can," he was quoted as saying.
Legally, Stepanov said the ousted members would have a solid case in court since the Central Depository had blocked many of the meeting's voting shares.
Ventspils Nafta stated that a majority of shareholders had participated in the meeting.
Meanwhile, Olafs Berkis, a minority shareholder in Lasco, has filed a claim demanding recognition of the fact that Ventspils Nafta holds more than half the company's shares and should therefore be required to buy out minority stakeholders.
Berkis told the Baltic News Service that he had sued Ventspils Nafta and Deutsche Bank Trust Company Americas as Lasco shareholders and was also claiming 30,000 lats (42,700 euros) in damages.
"I have reason to believe that, in fact, Ventspils Nafta holds more than 50 percent in Lasco as evidenced by publications" Berkis was quoted as saying in the newspaper Neatkariga Riga Avize.
The Riga City Center District Court representative confirmed that they had received the claim application from Berkis, but said that Judge Raimonds Buls had opened the case only in regards to the claim for damages. The court had originally refused to hear the case, but Berkis can appeal this refusal to the Riga Regional Court within 10 days.
Officially Ventspils Nafta holds 49.94 percent in Lasco, while Deutsche Bank Trust Company Americas had blocked 2 million shares, or 1 percent in all Lasco shares, for the shareholder meeting on Feb. 11.
