Category: Estonia

Sorainen has announced that former Varul Partner Ants Mailend has joined the firm’s Tallinn office as a Partner, where he will strengthen the Sorainen Dispute Resolution Team as well as its Commercial Contracts Team and Intellectual Property Practice in Estonia.  

Ants Mailend was one of the five first Partners of the Varul law firm in Estonia, and was with that firm for over 20 years before joining Sorainen. “I have known Ants for more than 20 years as a person of high integrity and a great professional with a very good reputation within the legal community in Estonia,” commented Senior Partner Aku Sorainen. “In fact I tried to hire him 20 years ago when he returned to Estonia after finishing his master studies abroad and then again about 15 years ago, but he was very dedicated at that time to building up the firm he worked for back then.” Sorainen also praised Mailend as a strong “all-rounder,” since he has been practising in various fields of business law. “One aspect of our strategy is to gradually widen the scope of work for many of our lawyers and Ants fits well with this strategic approach,” Sorainen noted.

Mailend expressed his enthusiasm at joining Sorainen. “Over the years I have been watching the outstanding development of Sorainen with interest and respect,” he observed. “It is an honor and a professional challenge to join the leading and only truly integrated Baltic law firm.”  In addition, he noted the increasing importance of dispute resolution in legal business. “A large full service law firm should develop this practices in order to guarantee quality, increase market share, and have a balanced portfolio for leverage at times of market fluctuation.”

At Varul, Mailend managed the dispute resolution, banking & finance, corporate and M&A, and IT & IP practices. He has been a member of the Estonian Bar Association since 1996 and has also been on the board of the Estonian Bar Association for several years. He has regularly served as an arbitrator in institutional and ad hoc arbitrations. He studied law at the Universities of Tartu and Amsterdam, focusing on product liability and EU competition law. He also obtained an LL.M. from Amsterdam University in EU business law.  

Derling has advised the shareholders of Nortal on their buy-back of 50% of the Group’s shares from the Enterprise Investors investment fund and LHV Pension Funds, regaining full ownership of the company. 

The combined transaction price is EUR 15 million, based on the current equity value of EUR 30 million. Derling reports that there are 34 employees of the company among the shareholders, and that the transaction was financed by a combination of personal funds and leverage.

LHV Pension Funds entered as a Nortal Group shareholder in November 2012 and Enterprise Investors EVF I two years earlier. In the company’s press release, Nortal CEO Priit Alamae commented on the deal, saying that six years ago they reached a point where they needed investments to maximize the company’s potential for growth and expansion, and that they have since increased their revenue threefold.

Nortal is an IT company in the Baltics providing services to the public and healthcare sectors and to the private sector in the manufacturing & logistics, energy, telecom, and financial services industries.

Enterprise Investors is one of the oldest and largest private equity firms in Central and Eastern Europe.

Sorainen has advised Kindel Reklaam, Unicorpo, and Trend in the sale of 50% shareholding in Linna Ekraanid to Ekspress Grupp. The parties have agreed that Ekspress Grupp will acquire the remaining 50% of the shares of Linna Ekraanid in 2019.

Linna Ekraanid is engaged in the sale of digital outdoor advertising in Estonia.

The Sorainen team included Specialist Counsel Paul Kunnap and Associate Triin Tigane.

Sorainen did not reply to our inquiry about counsel for Ekspress Grupp.

Tark Grunte Sutkiene has successfully represented SIA Enefit, the subsidiary of the Estonian electricity producer Eesti Energia in Latvia, in a public procurement dispute before the Procurement Monitoring Bureau with VAS Latvijas Dzelzcels over the process that led to an electric supply agreement with AS Latvernergo worth EUR 12 million.

SIA Enefit claimed that VAS Latvijas Dzelzcel had failed to act transparently in the procurement process, had improperly restricted competition during negotiations, and had failed to carry out any negotiations with suppliers within the meaning of the public procurement regulations. 

According to Tark Grunte Sutkiene, “the Procurement Monitoring Bureau recognized that the application on the results of the negotiated procedure of VAS Latvijas Dzelzcels submitted by SIA Enefit was well founded, the violations committed by VAS Latvijas Szelzcels were substantial and could have had impact on the decision of the results in the negotiated procedure …. Accordingly, the Procurement Monitoring Bureau precluded VAS Latvijas Dzelzcels from concluding the agreement with AS Latvenergo and imposed an obligation to eliminate the violations found during the negotiations and to repeat its evaluation of the offers submitted in the negotiated procedure.”  

The Tark Grunte Sutkiene team representing SIA Enefit before the Procurement Monitoring Bureau consisted of Partner Linda Strause and Associate Mara Stabulniece 

Sorainen’s Estonian office has advised Amanda V East L.P., the fund managed by Finland-based eQ Private Equity, on an investment (made with BaltCap Private Equity Fund II) into DenCap OU.

DenCap — which had previously invested in dental care provider Unimed Group — has itself also acquired occupational health care service provider Qvalitas.   

Sorainen describes the Unimed Group (previously Dental Invest Estonia) as “one of the most innovative private medical groups in Estonia. Unimed clinics provide services in the fields of orthodontics, dentistry, dental labs, specialized medical care and sleep disorder treatment.” According to Sorainen, “Qvalitas was founded in 1996 and it offers high quality occupational health care as well as general and specialized medical services in Estonia.”    

The Sorainen team consisted of Partner Toomas Prangli, Specialist Counsel Kadri Kallas, Senior Associate Paul Kunnapm, and Associate Kai Vainola.

Sorainen did not reply to our inquiry about counsel for BaltCap Private Equity Fund II.

Primus has advised the Olympic Entertainment Group, a casino operator listed on the NASDAQ OMX Tallinn Stock Exchange, on its EUR48 million sale of the newly opened Hilton Tallinn Park hotel to a company within the East Capital investment group. Raidla Ellex advised East Capital on the transaction, which remains dependent on the approval of the Estonian Competition Authority.

According to Primus, “the purpose of the transaction is to release capital that has been invested by Olympic into real estate, and to focus on the core business of the group – operating casino and entertainment complexes. Hotel and casino operations based in the building are not part of the sales transaction and will continue to be owned by the Olympic group.”

Primus Tallinn, working in cooperation with real estate advisor Triple Net Capital, represented Olympic in all matters related to the transaction

The Raidla Ellex team consisted of Counsels Martin Kaerdi and Jaanus Ikla and lawyer Triin Tiru.

Image Source: hilton.com

Raidla Ellex has represented the BLRT Grupp and its majority shareholder Algaves against a claim brought by BLRT Grupp minority shareholders requesting dividends pursuant to minutes that reflecting a general meeting of shareholders that, according to Raidla Ellex, in fact had not taken place.  

The dispute covered both the authenticity of the minutes as well as the request for dividends. The courts found no basis for ordering dividends pursuant to minutes drawn up by the minority shareholders. 

According to Raidla Ellex, “what raises questions in this case is that the Estonian judicial authorities did not regard a claim made on a basis of fabricated minutes as something that would belong to the field of criminal law.” 

The Raidla Ellex team representing BLRT Grupp and Algaves consisted of Partner Arne Ots and Senior Associates Neve Uudelt and Martin-Johannes Raude.

Raidla Ellex has successfully represented Nordecon AS, one of the largest construction groups in Estonia, in a public procurement dispute with Riigi Kinnisvara AS, a real estate service company established by the Republic of Estonia.  

Riigi Kinnisvara AS organized a public procurement proceeding for renovating the Ugala Theatre building in Viljandi, Estonia. Nordecon successfully challenged Riigi Kinnisvara’s decisions regarding the qualifications of a competing bidder and, as a result, was awarded the procurement contract, valued at over EUR 7.8 million.   

Nordecon was advised by Raidla Ellex Partner Arne Ots and Senior Associate Martin-Johannes Raude.

Sorainen advised Northern Horizon Capital on upgrading the fund management company licence of its Estonian arm to an alternative investment fund manager (AIFM) licence and in establishing a new public evergreen closed-ended real estate fund. The Estonian Financial Supervision Authority (EFSA) granted the AIFM license and registered the fund, named Baltic Horizon Fund (“the Fund”), on May 23, 2016.

Northern Horizon Capital is a real estate investment manager with activities in the Nordic countries, Germany, the Baltics, Poland, and Russia. The AIFM license allows Northern Horizon Capital to, for example, manage alternative investment funds with assets under management exceeding EUR 100 million (in the case of unleveraged funds, exceeding EUR 500 million) and to “passport” its services throughout the EU on the basis of a single authorization.

In parallel, Sorainen advised Northern Horizon Capital in arranging a public offering and subsequent listing of units of the Fund, and also in the merger process of the Fund with the Baltic Opportunity Fund — another closed-ended real estate investment fund managed by Northern Horizon Capital. The capital raising and merger were completed simultaneously to allow trading in the units of the restructured fund to start promptly on July 6, 2016. The units were marketed to retail and professional investors in Sweden, to professional investors in certain other European countries under the AIFM Directive regime, and to other types of investor under exemptions available in specific countries where units were marketed. EFSA registered the prospectus for the public offering on June 6, 2016, while the merger was already approved on May 6, 2016 together with establishment of the Fund.

Sorainen reports that it “advised the client throughout the process, including in drafting AIFM internal rules and guidelines, the rules of the contractual fund, the merger decisions and documentation, the prospectus, the listing application, and in discussions and negotiations with the EFSA, Nasdaq Tallinn, and the Estonian Central Securities Depositary.” The firm’s pan-Baltic team consisted of Estonian Partner Reimo Hammerberg, Estonian Senior Associates Gerd Laub and Jane Eespold, Lithuanian Senior Associate Daiva Liubomirskiene, Estonian Associates Kristina Promet and Kadi Sink, Latvian Associate Martins Rudzitis, and Lithuanian Associate Karina Kuizinaite, among others.

Raidla Ellex has advised Fifaa AS on the acquisition of British fashion brand River Island shops in Estonia from RIFF OU.

Founded in 1993, FIFAA  specializes in company clothing and commercial gift sales. It is an official importer for known brands such as Skechers, Dune London, Russell, Fruit Of The Loom, Spalding, Jako, Peak and And1. In addition to wholesales, it is the lead store chain for Skechers, Dune London, and T-Shirt Store with 40 stores in Estonia, Latvia, and Lithuania. River Island has over 300 stores in Great Britain, Ireland, Russia, Netherlands, Poland, Belgiumm, and the Middle East. 

The Raidla Ellex team consisted of Partner Risto Vahimets and Senior Associate Martin Maesalu.