Russian firm in Liepajas Metalurgs buyout talks

  • 2013-11-15
  • From wire reports, RIGA

Liepajas Metalurgs is in talks over a possible sale

A Russian firm has confirmed its in talks over a possible 37 million euro buyout of Latvian metallurgical company, Liepajas Metalurgs, reports nozare.lv.

"We are interested in acquisition of "Liepajas Metalurgs", because what previously obstructed our investments in the company is now gone. We are prepared to buy Liepajas Metalurgs and renew production," said Sergey Pisarchuk, a representative of Afina Pallada who are in talks.

In October, Afina Pallada said it would not rush to invest in the struggling Liepajas Metalurgs as the company's creditors or shareholders did not offer a clear and safe investment environment with guarantees until the end of the legal protection plan.

It follows after courts launched a bankruptcy case against Liepajas Metalurgs on Nov. 12. Up to 1,500 workers have begun to be laid off at the company this month.

In August, Afina Pallada said it was ready to buy Liepajas Metalurgs for up to 50 million dollars (27.5 million lats/ 37 million euros)

"I can add that the talks will continue and the next meeting is scheduled for early December. Now it is important to reach agreement on Liepajas Metalurgs sales conditions and the amount for which it could be sold," added Pisarchuk.

Meanwhile, stock-taking will take place at Liepajas Metalurgs and an assessment of the company will be performed. A sales plan for the company will be drawn up,  Haralds Velmers, the company's insolvency administrator said.

"My task is to separate the metallurgical company from all other functions not associated with its main business, therefore making it more attractive for potential investors. This will be a moment of truth, because investors will be able to buy a company and be sure that they will encounter no surprises in the company's balance sheet," stressed Velmers.