Category: Estonia

Ellex Raidla has advised Tera Ventures on its investment in Estonian property rental start-up Rendin.

Rendin is a Tallinn-based developer of a long-term home rental agreement platform. According to Ellex Raidla, Rendin raised a total of EUR 1.2 million from a group of investors led by Tera Ventures that included Iron Wolf Capital, Truesight Ventures, Atomico Angel Program, Startup Wise Guys, and a number of angel investors. Rendin is expected to use the investment to expand its core team in Estonia and launch its platform in Poland.

Tera Ventures is an Estonian venture capital fund which invests in early-stage global digital startups. The company was founded in 2016 and currently manages 12 active investments.

Ellex Raidla’s team consisted of Counsel Antti Perli, Senior Associate Hanna Pahk, and Associate Merlin Liis.

Ellex Raidla did not reply to an inquiry about the deal.

Ellex Raidla has advised real estate development company Liven on its EUR 2 million bond issuance.

According to Ellex, the company issued 20 mortgage-backed bonds with a nominal value of EUR 100,000, with a redemption date of March 31, 2023, through a non-public offer. The proceeds from the issue will be used to finance a new residential and commercial building in Tallinn scheduled to be built by the end of 2023.

Ellex Raidla’s team consisted of Partner Ermo Kosk and Counsels Toomas Kasesalu and Rain Raa.

Ellex Raidla did not respond to an inquiry about the deal.

The Tallinn office of Sorainen, working with DLA Piper Helsinki, has advised paints producer PPG on a voluntary recommended public cash tender offer for all the shares in Tikkurila, a Nordic paint and coatings company. 

Sorainen’s team included Partners Piret Jesse, Eva Berlaus, and Laimonas Skibarka, Counsels Lauri Liivat, Pirkko-Liis Harkmaa, and Evaldas Dudonis, Senior Associates Zanda Frisfelde, Aurelija Daubaraite, Lise-Lotte Laane, and Britta Retel, Associates Maris Simulis and Mindaugas Dominykas Baniulis, and Legal Assistant Kadri Puu.

Sorainen did not reply to our inquiry on the matter.

TGS Baltic’s Estonian office has successfully represented Pipes Building OU in a dispute against Narva Vesi AS, a company belonging to the Estonian city of Narva.

TGS Baltic reported that the case concerned payment for two building contracts and related damages. According to the firm, work on the buildings was performed as part of an infrastructure project financed by the European Union. TGS Baltic reported that it managed to settle the case on “extremely beneficial terms” for Pipes Building, including Narva Vesi’s agreeing to pay the principal claims for contracts and partial damages as well as waiving all counterclaims.

TGS Baltic’s team consisted of Senior Associate Vitali Sipilov and Associate Maris Vutt.

Ellex Raidla has advised the BaltCap Growth Fund on an acquisition of a majority stake in Tradehouse from founders Avo and Angela Kivimaa. PwC Legal advised the selling shareholders on the deal.

Financial details of the transaction were not disclosed.

Tradehouse is an Estonian beauty products wholesale and retail company that was founded in 2002. The company operates five large-format stores, an e-commerce platform, and a professional training center in Estonia. Ellex reported that, through the investment, BaltCap has acquired the majority stake in the company, with Avo and Angela Kivimaa retaining a minority stake and remaining at the company as members of the supervisory board.   

Ellex Raidla’s team included Partner Ermo Kosk, Senior Associates Alla Kuznetsova and Martin Maesalu, and Associates Merlin Liis and Kevin Gerretz.

PwC Legal’s team consisted of Head of M&A Rutt Vark and Specialist Counsel Indrek Ergma. 

Nove has advised Elering on its agreement with Siemens Energy for the construction of three synchronous compensators for frequency stability of the electricity systems at the 330 kilovolt substations in the Estonian communities of Viru, Pussi, and Kiisa.  

The Estonian branch of Siemens Energy Oy and Siemens Energy Global, which participated in the tender as joint bidders, were confirmed as the winners of the tender as the lowest bidder. The total cost of the tender was EUR 83.5 million. According to an Elering press release, “the cost of the procurement was assessed in three parts – in addition to the construction cost of the compensators, maintenance costs over eight years and operating costs over the life of the equipment were also taken into account.”

The devices will be manufactured at the Siemens Energy Global plant in Germany. The design and construction of the synchronous compensators will begin in 2021 and the final of the three is expected to be commissioned by the end of 2024.

By the end of 2025, the Baltic States will be ready to disconnect their electricity systems from Russia’s interconnected electricity system, where the frequency is controlled by Russia. The transition to the continental European frequency band is expected to give the Baltic States full control over their electricity systems. 

According to Taavi Veskimagi, Chairman of the Management Board of Elering, synchronous compensators are the primary technical capability of Elering dispatchers to ensure the operation of the electricity system after the separation from Russia. “Without the inertia provided by these devices, the risk of the power system suddenly shutting down and consumers being left without power would be very high,” Veskimagi explained. |This is a very important investment in creating the ‘first defensive wall’ of the electricity system.”

Nove’s team included Partner Kristjan Tamm and Attorney at Law Veiko Vaske. 

The Tallinn office of TGS Baltic has advised Nikolai Russakov, the owner of the AS Kroodi Terminal fuel terminal and MK Kamion OU fuel wholesaler, on the sale of the two companies to Terminal Oil OU. The transaction is still subject to regulatory approval.

TGS Baltic’s team included Partner Sander Karson, Attorney Triinu Jarviste, and Junior Counsel Mirko Kikkamagi. 

Sorainen’s Tallinn office has advised the Saunum Group on the initial public offering of its shares and their admission to trading on the First North alternative market, operated by Nasdaq Tallinn.

The Estonia-based Saunum Group specializes in the development, production, and sale of sauna devices.

According to Sorainen, the offering was ten times oversubscribed and nearly 1500 investors submitted subscription orders. According to the firm, “approximately EUR 500,000 raised by the offering will be used to finance product development as well as sales and marketing activities in Estonia and selected export markets.”

Sorainen’s team consisted of Senior Associate Katlin Krisak and Associate Oliver Amarik.

Sorainen did not reply to an inquiry about the deal.

PWC Legal’s Estonian office has successfully represented the Estonian Authors’ Society, the Estonian Association of the Phonogram Producers, the Estonian Performers’ Association, the Estonian Association of Audiovisual Authors, the Estonian Composers’ Union, the Association of Estonian Professional Musicians, the Estonian Directors’ and Dramaturgs’ Union, the Estonian Association of Stage Performers, and the Association of Professional Actors of Estonia in a dispute regarding compensation for the reproduction of original works.

According to PWC Legal, nearly 9000 creators represented by the organizations are entitled to the compensation under the EU Infosoc Directive, but were deprived of the right between 2014 and 2018 because of gaps in Estonia’s national legislation.

PWC Legal reported that, “since the Supreme Court of Estonia refused to open proceedings on appeals in cassation, the ruling handed down by Tallinn Circuit Court on June 30, 2020 became final on Tuesday, December 8, 2020.” As a result of the ruling, Estonia will have to pay over EUR 3.5 million to the plaintiffs by January 7, 2021, which, PWC Legal reported, “covers five years’ compensation for reproduction of works for private use, penalties on late payment of the amount and procedural costs.” In addition, the firm reported, “a further penalty in the amount of EUR 656 per each delayed day is due until the entire amount has been paid.”

According to PWC Legal, “at present, Estonia is the only member state of the European Union which has not guaranteed its creators a fair compensation for copies made in the digital and smart environment for private use and where the affected persons need to retroactively seize the court for the effective protection of their rights.”

“Estonian creators are entitled to a compensation that equals at least the average compensation in the EU,” commented Priit Latt, Partner at PWC Legal in Estonia, who led the firm’s team on the deal. “However, Estonian legislation is currently not yet in line with EU law and still fails to take into consideration the realities of the digital era, for which reason the creators have no choice but to litigate for the compensation. Authors, performers and phonogram producers of the digital era must also have a right to demand protection of their works and fair compensation for the use of their works.”

Sorainen has advised Estonian mobility platform Bolt on a EUR 150 million funding round. The investment was led by D1 Capital Partners, with the participation of Darsana Capital Partners. 

According to Sorainen, “Bolt will use the funds to further enhance the safety and quality of its products as it continues to grow its ride-hailing, micromobility, and food delivery services in Europe and Africa. The company is already offering a number of ride-hailing safety features in both its rider and driver apps, including an SOS button, designed to let users contact emergency services quickly if needed.” According to the firm, “in 2021, Bolt is planning to roll out new functionalities to further enhance the safety of its products, such as automated trip monitoring to predict and prevent potential incidents with the use of artificial intelligence.”

Sorainen’s team included Partner Toomas Prangli and Associates Mirell Prosa and Vladislav Leiri.

Sorainen did not reply to our inquiry on the matter.

Editor’s note: After this article was published, CEE Legal Matters learned that Orrick had advised Darsana Capital Partners on its participation in the funding round. The firm’s team included London-based Partner Shawn Atkinson and Managing Associate Stephen Tallon.