Swedbank files claim against DK Daugava

  • 2011-01-20
  • From wire reports

RIGA - Owner of the milk and bread company Piena un maizes nams Daugava, Baiba Batraga, has purchased the troubled ‘multi-industry’ firm Daudznozaru kompanija Daugava (DK Daugava) shares, according to the Registry of Enterprises’ Lursoft database, reports Nozare.lv. Batraga purchased all DK Daugava shares for 1.6 million lats (2.2 million euros).
On Jan. 14, due to several gross violations by the debtor, its creditor bank - Swedbank - decided to enforce its claim that DK Daugava repay its bank loan of 1.1 million lats. Swedbank has already received Zemgale Regional Court’s decision that DK Daugava and Piena un maizes nams Daugava assets will be arrested, as well as the involved persons’ bank accounts and property, says public relations manager for Swedbank, Ivars Svilans.

Swedbank turned to the court following half-year long efforts to resolve the situation and restructure DK Daugava’s debt. The bank continuously supported the company during the economic crisis, it said, so that the company would be able to invest in the development of a retail network, and postponed the debt repayment term for more than six months.
The retail network has been developed and is operating, but has been given to another company - Piena un maizes nams Daugava - which currently is DK Daugava’s product distributor and which, according to Svilans, purchases products for prices that do not cover even the production costs.

DK Daugava has also given its brand names to people connected with the company’s former owner, Aigars Vaivars.
“Taking into account the amount of company debt, if it were to cease to function, it would not be possible to repay the debt, and the bank would suffer losses. Therefore the company’s future course will depend on its management and owners,” said Svilans, who added that “the bank always supports fair business, where both sides are following their obligations, and the business is transparent and honest. However, if the obligations are not observed, the bank’s actions will be stern and swift,” said Svilans.
Vaivars, however, pointed out on Jan. 14 that Swedbank has been displaying ‘financial terrorism’ against many Latvian producers. Vaivars bases this claim, and of the bank’s “unlimited use of power” on its asking him to repay a debt, even though he says contractual liabilities are being observed.

DK Daugava is not the only victim on Swedbank’s list of valuable companies, many of which have already been led to bankruptcy or seized, he adds. Perhaps ‘raiderism’ is common in Sweden in the interests of certain businessmen, however, in Latvia, it is against the law, and revocation of the bank’s license would be an appropriate punishment for it,” claimed Vaivars. He also urged security services to keep an eye on the situation, so that “no employees suffer, while Swedbank takes over our company.”

“I am bewildered as to why the bank is so aggressive, especially when the payments were made according to the contract’s terms, while the bank itself reserved the payment and deliberately did not divert it to the debt’s repayment. And I am also bewildered as to why Zemgale Regional Court has decided to arrest Piena un maizes nams Daugava assets, since the company is not legally connected with DK Daugava debt,” said Vaivars.

“Swedbank is trying to take over our company, which is currently at its most successful point, with dubious means. The bank’s statement that DK Daugava has also illegally given its brand names to other people is also inappropriate. The brand is my personal intellectual property and is not subjected to contractual liabilities,” asserted Vaivars.
Batraga also owns several brand names connected with DK Daugava, for example, two brand names - Dzivi produkti and Daugavas.

DK Daugava suffered losses of 542,748 lats in 2009, even though the company operated with a 242,466 lats profit in 2008, according Lursoft. The company’s turnover in 2009 totaled 1.6 million lats, which is 14.1 percent less than in 2008.
According to Firmas.lv information, DK Daugava share capital totals 1,603,000 lats.