King and Queen fold their cards

  • 2010-11-03
  • Staff and wire reports

RIGA - Well-known Latvian businessman and owner of the restaurant and leisure chain Lido, Gunars Kirsons, has filed for personal insolvency, reports Nozare.lv. Several of Lido’s creditors are not satisfied with the court-approved measures for the company’s legal protection process and have decided to turn to owner Kirsons as a private individual.

A statement by Kirsons indicates that the claims placed against him by creditors will in no way affect the activity of Lido or the agreed measures for the company’s legal protection process. The businessman indicated that he will provide more detailed information once the court has decided on his application for personal insolvency.

At the Lido Design Factory, one employee received, instead of a salary for the past year, a promissory note signed by company owner and director Kirsons, a fate similar to dozens of others at the firm.
And although the employee submitted a letter of resignation, the company’s management has yet to accept and issue the documents necessary for beginning work elsewhere. The man turned to the State Labor Inspection, who where unable to provide assistance.

Kirsons provided a written public statement on the matter, explaining that things were not going smoothly for Lido Design Factory, but expressed hope that orders would soon come in and the situation would improve.
He admitted not paying salaries to employees; however, the businessman blamed this on the poor economic situation. The Lido director promised that the employee in question would soon be provided with the documents necessary for finding new employment.

On Sept. 28, Riga’s Vidzeme District Court satisfied a request from Kirsons to apply out-of-court legal protection to his well-known catering and leisure firm Lido. The company operated with a turnover of 18.2 million lats (26 million euros) and losses of 603,342 lats last year. In 2008, turnover reached 25.4 million lats, with losses at 1.7 million lats. In 2007 turnover was 24.2 million lats with losses of 900,000 lats.

The main creditor of Lido is DnB Nord Bank, according to the company’s 2009 annual report. The State Guarantee Agency has provided security for loans given by banks to the company, showing that once again, the Latvian taxpayer may get stuck with the bill.

Another casualty of the deep economic crisis affecting Latvia is Ieva Plaude-Relingere, founder and shareholder of the beauty company Kolonna, who handed in an application for insolvency at the end of October to Riga Vidzeme District Court. According to an entry made on Nov. 1 in the Insolvency Register, the application was accepted, showing that on Oct. 29, an insolvency proceeding was opened.

According to the Latvian courts Internet site, Plaude-Relingere’s case will be examined by Judge Iveta Krevica. A date has not yet been set for the hearing.
As Plaude-Relingere herself explained, the claim is being made so that the daily operations of the Kolonna Group are not impeded, and is due to the businesswoman’s personal collateral obligations made to a total of seven commercial banks.

On Sept. 30 this year, Parex bank, without warning, arrested private accounts and property belonging to Plaude-Relingere, and Parex bank CEO Chris Gwilliam also testified in court that the businesswoman was in hiding abroad. “I was astonished, as I had just met with Mr. Gwilliam on September 15 in order to discuss the matter of my private securities, and we had agreed to meet again in several weeks. I had asked him simply to call me if he had the feeling that I was not reachable,” replied Plaude-Relingere.

“The beginning of this private insolvency proceeding is an enforced step due to the stance of Parex bank, and is directed not only at renewing my solvency, but also at safeguarding the equal rights of each of my creditors, which Parex bank is currently attempting to circumvent,” stressed the businesswoman.

Plaude-Relingere stressed that Kolonna belongs to a large number of shareholders, and so her application for insolvency will have no direct affect on the concern’s activities.
The Kolonna holdings operated in 2009 with a turnover of 105 million euros. The concern includes 21 companies, and employs a total of 971 people.