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PA board quits ahead of Citadele sale

  • 2014-10-31
  • From wire reports, RIGA

The Latvian Privatization Agency board has resigned ahead of the pending 100 million euro sale of Citadele Bank to Ripplewood Advisors, reports LETA.

CEO of Latvian Privatization Agency, Ansis Spridzans, told LETA that he and board member Guntis Lausks submitted their resignation letters on Oct. 29 because they do not support the government's decision to sign the agreement on selling Citadele without delay.

Specifically, Spridzans pointed out, that there was a chance to discuss the agreement's terms until the end of the year. He believes that the terms need to be improved, as they are "not good enough;" nevertheless, the government plans to sign the agreement as soon as possible.

Spridzans and Lausks refuse to sign under the current terms. Spridzans did not provide detailed comments on what exactly should be improved, adding that the Citadele sale agreement is a confidential document.

"Time will show whether this was the best option," Spridzans said.

The Privatization Agency's shareholders were to hold a meeting yesterday to decide on further action.

Following Societe Generale's recommendation, the government decided on Tuesday to sign the Citadele sale agreement with U.S fund Ripplewood Advisors LLC.

Prime Minister Laimdota Straujuma believes that if the Citadele sales process is not concluded, the now former Privatization Agency board member Spridzans will be held responsible.

''Spridzans will be held responsible, as he is the person who has been dealing with the sales process the past two years and the one responsible for ensuring the best possible conditions for the sales deal,'' the prime minister explained. ''This leads me to question - what has he been doing the past two years?'' Straujuma asked.

The prime minister expressed bewilderment at Spridzans' decision to suddenly step down. She believes that he is fearful of taking responsibility. ''Such a step does not say anything good about his professionalism, as he was the one who submitted such a sales agreement to the government,'' she added.

In order for the PA to sign the agreement today, Oct. 31, on the sale, the signatures of two PA board members are needed. Since there are no board members at the moment, the PA is not capable of authorizing any decisions until a new board is appointed.

U.S. investor fund Ripplewood Advisors, the confirmed buyer of the state's stake in Citadele Bank, announced yesterday that it understands that postponement of the signing of the contract is "merely technical in nature." In other words, the Cabinet has officially approved the deal, therefore the investor’s offer to buy still stands.

Nonetheless, Straujuma's meeting today with Ripplewood Advisors’ Tim Collins, has been cancelled.

The Cabinet let it be known that the deal on Citadele will be finalized only when a new board is intact at LPA.