The Ventspils Nafta (VN) company, as the leading owner of the Latvijas kuģniecība 

(Latvian Shipping Company (LK)), is maliciously trying to limit the operations of SIA LASCO Investment, which is an LK subsidiary.  This is seen in a series of processes which have nothing to do with good business practices and suggest that VN is engaging in considered and planned actions aimed at limiting the solvency of and then shutting down LASCO Investment.

The LASCO Investment board feels that in order to avoid unpredicted losses, it has to take advantage of the rights that are given to it by law, implementing legal protection processes that do not involve the courts, but do apply to several enterprises that are part of the SIA LASCO Investment Group – those that are engaged in the fields of real estate administration and management.  

“We have asked VN several times to work with us on finding constructive solutions to problems which exist in terms of the relationship between the two companies that is based on civil law.  Sadly, VN has instead made categorical demands about the obligations of LASCO Investment, insisting that these be satisfied immediately.  This does not serve the interests of our shareholders or those of VN shareholders.  This is short-sighted behaviour that is fully out of line with good and sensible business practices.  Obviously, the aim is to limit the solvency of LASCO Investment in a purposeful way.  That’s why we’ve taken legal steps to protect the value of the company and the interests of our shareholders,” says SIA LASCO Investment board chairman Raitis Nešpors.

Application of these procedures will prevent LASCO’s insolvency and allow the company to attract the financing that is needed in relation to assets which were purchased in December 2008 on the basis of an agreement between LASCO and VN.

LASCO Investment has asked VN several times to review the schedule for payments in relation to the assets and to revisit the value of the assets in accordance with fundamental changes in the economic situation of Latvia and the rest of the world.  VN has done nothing to indicate that it wants to work with the company.  Three proposals from LASCO on ways of working together have been flatly ignored.

“The board of the Latvian Shipping Company supports the decision of LASCO Investment to seek legal protections outside of the courts for the company’s real estate management firms.  LK is sure that the long-term value of LASCO investments is far higher than the amount that would be received if they had to be sold as a guarantee object.  Accordingly, these legal protections are in the interests of all LK shareholders,” says LK board member and vice president Raivis Veckagāns.

During the period of legal protections, which will last until April 2012, LASCO Investment will attract financing from independent financial institutions (banks or other sources) so that it can fulfil its obligations vis-à-vis VN.  The company hopes that the economic situation will improve during that period in time.  That will allow LASCO to continue the strategy for developing real estate investments which the Latvian Shipping Company has approved.  In the medium term – i.e., in three to five years’ time – this will ensure profits for LK shareholders from the sale of the real estate investments.

More detailed information:

Marita Ozolina-Tumanovska

Head of PR & Advertising Department

Phone: +371 67020120, 29287169

E-mail : marita.ozolina@lscgroup.lv