Category: Estonia

PWC Legal has been selected as the legal, business, and tax advisor of the Estonian e-residency program.

The Estonian e-residency program was established in 2014, and by March 2021, Estonia had more than 79,000 e-residents. According to PWC Legal, “the status of an e-resident provides secure access to all Estonian public and private sector e-services, allowing e-residents, inter alia, to set up an Estonian company that is convenient to manage remotely. Today, e-residents have already established more than 16,000 Estonian companies. The total economic impact of the program was close to 54 million euros by the end of 2020.”

“We value the opportunity to support one of the success stories of e-Estonia with our dedicated professional international team,” said PWC Legal Partner Priit Latt. “The e-residency program is a global initiative, the impact of which on the diversification of the Estonian economic environment is significant. Among other things, we contribute to ensuring that the service standard of companies providing services to e-residents is high and their background impeccable.”

“Due to the nature of the e-residency program, a high-quality legal, business and tax advisory service is very important for the team,” commented Lauri Haav, CEO of the Estonian e-residency program. “We want to offer e-residents the best possible experience. The work of the PwC Legal team best met the conditions set out in the tender and offered good value for money. We are convinced that the office ensures the best possible competence. Win-win in every sense!” 

Nove Attorney Veikko Puolakainen has successfully represented Estonian bus company AS SEBE in a lawsuit related to the procurement of public buses in Harju County, Estonia, by MTU Pohja-Eesti Uhistranspordikeskus. 

According to Nove, during the procurement procedure, “the Contracting Authority announced an additional tender for the award of a direct contract for the eastern bus service of Harju County, as the main procurement had become entangled in various court disputes and there was a risk of interruption of the regular service. The current carrier AS SEBE won the tender and was declared the successful bidder. The second best bidder, OU ATKO Liinid, contested the results of the competition.”

According to the firm, “the Public Procurement Appeals Committee rejected the appeal due to the lack of a right of appeal. The appellant filed an appeal with the Tallinn Administrative Court, which terminated the proceedings due to the abandonment of the later appeal, as the direct agreement had already been concluded at the time the court was seised. The conclusion of the direct contract ensured the uninterrupted continuation of passenger transport in the eastern part of Harju County even in a situation where various disputes continued in the main procurement.”

Nove attorney Veikko Puolakainen has successfully represented Estonia’s Land Board in the country’s Supreme Court.

According to Nove, “the central issue … was whether it is possible to form an independent cadastral unit in a public body of water (the Baltic Sea).” According to the firm, “the Land Board refused to register [a] cadastral unit because the formation of a cadastral unit on the surface of a public water body is not possible according to applicable law. The applicant challenged the Land Board’s refusal in administrative court.”

The Tallinn Administrative Court dismissed the case, but the Tallinn Circuit Court annulled that decision … and found the administrative act of the Land Board to be unlawful. Finally, in a decision of March 24, 2021, the Supreme Court annulled the decision of the circuit court … and upheld the decision of the administrative court, replacing the grounds of the administrative court decision with the grounds of the Supreme Court decision.”

Lextal has advised TB Grupp OU on the sale of conveyor service, maintenance, and components provider Technobalt Eesti OU and its Latvian and Lithuanian subsidiaries to the Michelin Group. The transaction remains contingent on regulatory approval.

Lextal’s team was led by Partner Ants Karu.

Lextal did not reply to our inquiry on the matter.

Lextal has advised wind energy developer Raunistal on its sale to the Eesti Energia subsidiary Enefit Green. 

Following this transaction, the Enefit Green renewable energy company will be completing Raunistal’s Purtse wind farm project in Ida-Virumaa, Estonia.

Lextal’s team included Partners Olavi-Juri Luik and Ants Karu.

Lextal did not reply to our inquiry on the matter.

PwC Legal has advised real estate manager and administrator Stell Estonia on the acquisition of competitor Kyyrix.

Stell employs 1,500 people and serves nearly 400 business customers and more than 300 apartment associations across Estonia. The company’s turnover in 2019 was EUR 21 million and its operating profit was EUR 744,000.

Kyyrix employs almost 250 people and serves over 200 industrial companies in South Estonia. In 2019 the company’s turnover was EUR 3.2 million and its operating profit was EUR 190,000.

PwC Legal’s team consisted of Head of M&A Rutt Vark, Specialists Counsels Karin Marosov and Indrek Ergma, and Attorneys-at-Law Jana Tudelep and Maris Alt. The firm did not reply to an inquiry about the deal.

The Estonian office of the Njord law firm has assisted Estonian Japan Trading Company AS obtain admission to the trading of its shares on the First North alternative market, operated by Nasdaq Baltic.

According to Njord, the Estonian Japan Trading Company will develop trade and investments between Japan and the Baltic region. According to the firm, the company is not issuing its shares to investors yet, but it plans to issue public float shares at a total value of EUR 1.5 million in the third quarter of 2022 and another issue in the fourth quarter of 2023.

Njord’s team was led by Associate Virgi Nael.

Ellex Raidla has advised Coop Pank on a public offering of unsecured subordinated bonds.

Based on Estonian’s capital, Coop Pank is one in five universal banks operating in Estonia. Coop Pank’s banking services are used by more than 90,900 clients. The strategic owner of the bank is the domestic retail chain Coop Eesti, with a sales network of 330 stores.

According to Ellex, the subscription period for the bonds starts on March 16, 2021 and will end on March 26, 2021. According to the firm, “the offering will be targeted to all retail and institutional investors in Estonia. Coop Pank offers publicly up to 8000 unsecured subordinated bonds of Coop Pank EUR 5.5 Coop Pank bond 21-2031 with the nominal value of EUR 1000 each.”

“The purpose of the bond program is to finance Coop Pank’s future growth strategy,” said Margus Rink, chairman of the management board at Coop Pank. “Over the last four years, Coop Pank has grown its operating volumes by about 40% a year, and our footprint in the Estonian economy is becoming more and more noticeable. We have so far covered the capital needs arising from growth through earned profits, subordinated bonds issued in 2017 and 2019, and an additional share issue and initial public offering in 2019. The money raised in this bond issue is also planned to be used to support the growth of Coop Pank.“ 

Ellex’s team included Partner Gerli Kivisoo, Senior Associates Kadi Sink and Alla Kuznetsova, and Associate Kevin Gerretz.

Orrick has advised Scoro, a producer of work management software for professional service businesses, on the closing of a USD 16.4 million Series B round led by Kennet Partners. Additional investors include Columbia Lake Partners, Inventure, Livonia Partners, and Tera Ventures. Estonian legal advice to Kennet Partners was provided by Hedman Partners, working with lead counsel Sheridans, and to Scoro by Eversheds Sutherland.

Kennet is an international growth equity firm that invests in companies in Europe and North America. With offices in London and Silicon Valley, the firm supports entrepreneurial technology businesses with expansion capital to accelerate growth and build shareholder value. 

“Even before Covid-19 hit, most professional service businesses used as many as a dozen different platforms daily,” said Scoro’s Founder and CEO, Fred Krieger. “However, teams now realize that constantly switching between tools harms productivity and results in lost data and duplicated work. In many ways, these tools became weapons of mass distraction. We’re proud to have the support of Kennet Partners and other investors as we help businesses identify and remove these weapons of mass distraction with our end-to-end work management software.”

Orrick’s team included, in London, Partners Shawn Atkinson, Jonathan Rosen, Scott Morrison, and Ian Shaw, and in San Francisco, Partner Dolph Hellman.

Hedman Partners’ team included Managing Partner Merlin Seeman, Senior Associate Kati Pino, Associate Kristel Tael-Same, and Junior Associate Johanna Rahn.

Eversheds Sutherland’s team included Estonia Managing Partner Maivi Ots and Associate Taavi Koiv.

Ellex Raidla has advised Estonia’s Elektrilevi on its acquisition of the Imatra Elekter energy services provider from Imatran Seudun Sahko. Finland’s LLH Law advised the sellers on the deal.

The transaction remains subject to clearance by the Estonian Competition Authority.

“The transaction came from an initiative of the Finnish energy group Imatran Seudun Sahko, which wanted to [exit from the] Estonian business and leave it in professional hands,” commented Mihkel Harm, chairman of the management board of Elektrilevi. “As this coincided with our wish to expand the distribution network business, we reached an agreement.”  

Ellex Raidla’s team included Partners Martin Kaerdi and Martin Maesalu and Counsel Triin Frosch.