Category: Estonia

Sorainen has advised Mehilainen, a healthcare and social services provider in Finland, on the acquisition of occupational healthcare provider Qvalitas Arstikeskus and dental care chain Unimed Grupp from BaltCap. Ellex Raidla advised BaltCap on the deal, which remains contingent on regulatory approval.

According to Sorainen, “the new strategic owner will continue under the same brand and with the same board in both organizations.”

Sorainen’s Estonian team was led by Partner Piret Jesse and Senior Associate Piret Lappert and included Counsel Pirkko-Liis Harkmaa, Senior Associates Kaido Kunnapas, Piibe Lehtsaar, Britta Retel, Lise-Lotte Laane, Robin Teever, Monika Tomberg, and Mirjam Vichmann, Associates Liisa Maria Kuuskmaa and Katlin Helena Sehver, and Legal Assistant Kadri Puu.

Ellex Raidla’s team was led by Partner Ermo Kosk and Senior Associate Sandra Vark and included Managing Partner Ants Nomper, Partners Gerli Kivisoo and Martin Maesalu, Counsels Toomas Kasesalu and Dmitri Rozenblat, Senior Associates Maria Teder, Julia Kisseljova, Hanna Pahk, and Anneli Krunks, and Associates Kevin Gerretz, Merlin Liis, and Kairi Kilgi.

Maido Lillemets, Legal and Compliance Manager at BaltCap in Estonia, reports that the three-pillar pension system in his country has been shaken by the recent legislative move from a mandatory to a voluntary approach to contributions into pension funds. This change, Lillemets reports, has cost the pension funds EUR 850 million already and the eventual cost may exceed EUR 1 billion.

“Until last year, contributions to the second pillar of our pension system were obligatory,” Lillemets says, explaining that the second pillar consists of privately owned pension funds. “However, since January 2021, contributions to the pillar were made voluntary, so people can now apply not only to stop the ongoing payments into it, but also to withdraw their money from it.” 

According to Lillemets, such a radical change will most likely affect the liquidity of pension funds belonging to the second pillar. In turn, he believes, the drop in contributions to the fund will cause a drop in both the number and volume of pension funds’ private equity and venture capital investments in the region. “Since pension funds must now take into account that people will be able to withdraw their money from the system, they will not be able to invest in illiquid asset classes as they used to,” he says. Some of the funds may opt for feeder fund structures in order to overcome this obstacle. Through such feeder funds, PE and real estate funds are hoping to attract retail investors and pool resources together in order to continue investing in the region.

However, the change to the pension system might pose a threat to people as well. Lillemets suggests that the first pillar, which remains mandatory and is funded by taxes, will not be sustainable due to the discrepancy between the dwindling working population and the growing number of pensioners. “In the long term,” he says, “the state will probably have to raise taxes in order to fill the gaps in the first pillar.”

In addition, Lillemets points to the EU Sustainable Finance Disclosure Regulation, which will come into force on March 10, 2021. According to him, It will impose new environmental, social, and corporate governance regulations aimed at making investments eco-friendly and sustainable. In turn, he says, the regulation will bring about a drop in non-ESG-compliant investments.

Finally, looking into the future, Lillemets expects the legal sector to face technological challenges. According to him, the need to implement smart solutions for marketing, communication, and doing business persists. “With lockdowns still in place,” he reports, “it is as important now as it was last year for lawyers to keep developing their technological prowess.”

Originally reported by CEE In-House Matters.

Sorainen has helped to establish the Green Tiger Foundation in Estonia, a collaboration platform designed to boost environmental awareness and create a basis for a green economy.

According to Sorainen, Green Tiger is part of a bigger plan for “keeping the world clean.” According to the firm, “with the first-ever World Cleanup Day held on September 15, 2018, involving 17.8 million people from 157 countries, the world was also introduced to the Keep It Clean plan. Developed by internationally renowned scientists, it outlines principles for ensuring that the world remains as clean as possible. The next step in the plan is drafting the implementation schemes to keep each individual country clean. Green Tiger will jumpstart this program by creating a roadmap that will serve as an example to other countries.”

Sorainen’s team included Partner Karin Madisson and Associate Kirsi Johanna Koistinen.

Sorainen has helped Bolt obtain a EUR 20 million investment from the International Finance Corporation.

Bolt — originally known as Taxify — offers vehicle for hire, micro-mobility, and food delivery services. The company is headquartered in Tallinn, Estonia and operates in over 200 cities in 40 countries in Europe, Africa, Western Asia and Latin America. According to Sorainen, the IFC’s investment in Bolt was carried out through a convertible note. According to the firm, Bolt will use the investment to launch and expand its mobility services, as well as to improve the sustainable transport options in emerging markets in Eastern Europe and Africa.

Sorainen’s team included Tallinn-based Partner Toomas Prangli, Senior Associate Robin Teever, and Associates Vladislav Leiri and Mirell Prosa. The firm declared itself unable to disclose any further information about the deal.

Sorainen has advised Japanese trading and investment business conglomerate Marubeni on an unspecified investment in Estonian energy storage technology developer Skeleton Technologies.

According to Sorainen, through the investment, Marubeni will “leverage its global marketing capabilities to carry out the sales of Skeleton’s ultra-capacitors in Japan and other Asian countries and will develop the applications of its next generation products utilizing its relationship with existing clients in various industries.”

Skeleton Technologies develops and manufactures ultra-capacitors used as energy storage devices in various industries. The company operates research and development facilities in Estonia and Germany and a manufacturing facility in Germany.  

Sorainen’s Estonian team included Partner Toomas Prangli, Senior Associate Robin Teever, and Associate Mirell Prosa. The firm declared itself unable to disclose further information about the deal.

Eversheds Sutherland has helped IPF Digital AS obtain an e-money institution authorization, which allows it to issue e-money and provide payment services.

IPF Digital is a consumer credit company in Estonia that operates under the Credit24 trademark. It is part of the London Stock Exchange-listed International Personal Finance Group.

Eversheds Sutherland’s team included Managing Partner Maivi Ots, Senior Associate Dmitri Zdobnoh, and Associates Artjom Luik, Kaarel Eller, and Taavi Koiv.

TGS Baltic has successfully represented Eesti Post in a proceeding before Estonia’s Competition Authority initiated by direct marketing company Target Master.

According to TGS Baltic, Target Master submitted its complaint after its client Jysk Linnen’n Furniture OU decided to change its marketing service provider to Eesti Post, following a procurement procedure. According to the firm, Target Master claimed in its complaint that Eesti Post’s price formation is discriminatory since it was more favorable than offers made to other clients. TGS Baltic reported that Target Master further claimed that Eesti Post excluded it from the market since it is not able to profitably offer Jysk a price that is more favorable than the price offered by Eesti Post.

According to TGS Baltic, in its decision, the Competition Authority did not establish any violations in Eesti Post’s activities.

TGS Baltic’s team included Senior Associates Katri Paas-Mohando and Triinu Jarviste.

Lextal has advised the unidentified owners of Raunistal on the sale of 100% of their shares to Estonian state owned renewable energy company Enefit Green.

Financial details of the transaction were not disclosed.

Raunistal is the developer of the Purtse wind park in Ida-Virumaa, Estonia. Enefit Green will continue developing the wind park, which is expected to start producing electricity in 2023. The total capacity of the turbines will be nearly 20 megawatts, and the wind park is expected to generate approximately 40 gigawatt-hours of electricity each year.

Lextal’s team included Attorneys-at-law Olavi-Juri Luik and Ants Karu.

Cobalt’s Estonian office has advised technology-oriented venture capital fund Earlybird Digital East Fund on its provision of EUR 1.5 million in seed funding into Binalyze, a provider of advanced digital forensics and incident response solutions.

According to Cobalt, the funding will be used to accelerate the company’s growth and expansion across the US and Europe.

Cobalt’s team included Partner Kristel Raidla-Talur, Senior Associate Greete-Kristiine Kuru, and Assistant Lawyer Johanna Lumiste.

Cobalt did not reply to our inquiry on the matter.

Sorainen has advised BaltCap on its acquisition of Ridango, an Estonia-based provider of public transport services, from LipCap. Rask advised the seller on the deal.

Ridango specializes in the development of ticketing, real-time passenger information, and payment systems for public transport. In addition to Estonia, Ridango provides services to local governments and private carriers in six other European countries.

Sorainen’s team included Partner Toomas Prangli, Of-Counsel Isabella Barbara Aavik, Senior Associates Jane Eespold, Albert Linntam, Piibe Lehtsaar, Robin Teever, Triin Toom, and Kaido Kunnapas, and Associates Mirell Prosa and Vladislav Leiri.

Rask’s team was led by Partner Timo Kullerkupp.