Category: Latvia

Ellex Raidla has advised Ichiban OU on the sale of Auto Forte Tallinn OU, the retailer of Peugeot and Hyundai in Tallinn, to United Motors AS. Grant Thornton Baltic advised United Motors on the deal.

According to Ellex Raidla, “under the agreement, Auto Forte’s current owner and CEO Raido Toonekurg will continue at the helm of the company at least for the next two years.”

“United Motors is a strong owner with long-term plans who wants to grow and develop Auto Forte,” said Toonekurg. “Next year, we are planning to expand the Hyundai showroom of Auto Forte and invest in service equipment.”

The Ellex Raidla team was led by Partner Martin Kaerdi and Lawyer Karin Tartu.

The Grant Thornton Baltic team was managed by Partner Eneli Perolainen, assisted by Aet Sallaste, Elis Vija, Kristel Tiits, Sander Adamson and Mikk Magi.

TGS Baltic has assisted AS Augstsprieguma Tikls obtain merger clearance by the Latvian Competition Council for its potential acquisition of a decisive influence over AS Conexus Baltic Grid.

In December 2017, AS Augstsprieguma Tikls obtained 18.31% of the shares of AS Conexus Baltic Grid as reported by CEE Legal Matters on December 28, 2017 – a deal that eventually won the CEE Legal Matters Deal of the Year for Latvia as reported on June 7, 2018. Less than a month after that first acquisition AS Augstsprieguma Tikls obtained an additional 16.05% of the shares as reported on January 12, 2018, giving it a 34.36% shareholding in the company. TGS Baltic advised AS Augstsprieguma Tikls on both deals.

For complicated reasons involving other shareholders, according to TGS Baltic, AS Augstsprieguma Tikls currently owns the majority of votes in the decision-making bodies of AS Conexus Baltic Grid. Despite this majority, the firm reports, “the Latvian Competition Council has concluded that the influence of AS Augstsprieguma Tikls … shall not be considered as lasting and permanent, which is a prerequisite for recognizing actual decisive influence … over another company.” 

Despite this current lack of “lasting and permanent” influence, on December 13, 2018 the Latvian Competition Council went ahead to approve the merger, even if and when “decisive influence,” is eventually acquired down the road.

“This is a unique and landmarking case,” TGS Baltic explained, “in which the possible consequences of obtaining actual (de facto) control in the future are assessed even before obtaining lasting and permanent control, which is a prerequisite for recognizing of actual (de facto) decisive influence of a company over another company.”

The TGS Baltic team was led by Partner Andra Rubene and Senior Associate Mara Stabulniece, both supported by Legal Assistant Martins Galzons.

The Riga office of TGS Baltic has assisted Finland’s Nordea Bank Abp register a change of the pledgee in a commercial pledge provided by OneMed from Sweden’s Nordea Bank AB to Nordea Bank Abp as the result of the Nordea Group’s relocation of its head office from Sweden to Finland in the form of a cross-border merger of the bank into its wholly-owned Finnish subsidiary.

The entry in the Latvian Commercial Pledge Register regarding the registration of the change of the pledgee of the commercial pledge as the result of the reorganization was made on November 14, 2018, and the Lithuanian Mortgage Registry was updated on January 7, 2019.

The maximum secured amount of the claim is EUR 154,483,549.

Nordea is the largest financial services group in the Nordics and one of the biggest banks in Europe. TGS Baltic describes is as “a full-service universal bank with the total operating income of EUR 9.5 billion and total assets of EUR 581.6 billion in 2017,” and reports that it is “one of only a few European banks with an AA rating.”

The TGS Baltic team was led by Partner Andra Rubene, working with Associate Partner Neringa Grazinyte and Associate Reinis Grunte.

Ieva Andersone, already the Head of Sorainen’s Commercial & Regulatory Practice in Latvia, has joined the firm’s partnership.

Andersone, who began practicing law in 2003 and became an attorney-at-law in 2008, specializes in competition law, regulatory matters, intellectual property rights, litigation, and contract law. She joined Sorainen in 2005.

According to Sorainen, “in competition law, Ieva has experience in advising on merger transactions and drafting merger notifications for the Competition Council. She has represented clients in court to challenge decisions by the Competition Council, as well as helping clients reach a settlement by entering into an administrative agreement.” The firm also reports that she “has long experience in advising companies from regulated areas, especially in the pharmacy, electronic communication and information technology sectors. She has advised SIFFA (the Association of International Research-based Pharmaceutical Manufacturers); assistance also includes dealing with regulation of compensated medicines. In representing regulated areas, Ieva participates in M&A transactions, arranges transfer of licenses, special permits and intellectual property rights.” She also specializes in copyright and trademark matters.

The firm reports that “in addition to work and family responsibilities, Ieva also finds time for public activities. She supports equal opportunities for everyone ‒ here it is significant to note that after Ieva’s promotion the gender balance between the partners at the Sorainen Latvian office is now 50:50 (three female and three male partners). Ieva also devotes her time, experience and expertise to socially significant projects. For instance, she recently provided legal assistance to promoting a pre-election civic participation project and projects related to rights of journalists and the mass media. Ieva gladly shares her opinion and gives interviews to various media channels, explaining legal issues in plain and simple language.”

Andersone received her law degree from the University of Latvia in 2007 and an LL.M. from the University of Cambridge in the UK in 2008.

Sorainen has advised Hili Properties on its acquisition of SIA Tirdzniecibas Centrs “Dole” from AMD Holding. The target company is the owner and operator of the Dole shopping center in Riga, which has a total leasable area of 8,000 square meters.

Sorainen reports that Hili Properties is “part of Hili Ventures, a diversified business holding listed on the Malta Stock Exchange and which operates McDonalds restaurants in Latvia, amongst other interests.”

Sorainen’s team consisted of Latvia Managing Partner Eva Berlaus, supported by Senior Associate Renate Purvinska and Associate Liva Aleksejeva.

Editor’s Note: After this article was published CEE Legal Matters learned that Ellex Klavins, working with Simpson Thacher & Bartlett, had represented AMD Holding. The Ellex team consisted of Senior Partner Raimonds Slaidins, Senior Counsel Iveta Ceple, and Senior Associate Anna Misneva.

Ellex Klavins has advised commercial real estate fund SG Capital Partners Fund I KS on the acquisition of the SWH Office complex in the central business district of Riga from JSC SWH Grupa. SWH Grupa was advised by Fort Legal.

Additional transaction terms, including the price, were not disclosed.

According to Ellex, the SWH Office office complex consists of eight buildings and after renovation will have 40 thousand square meters of leasable space and 850 parking places located on more than four hectares freehold land plot.

SG Capital CEO Harijs Svarcs said, “the office complex is a good addition to the nearby Duntes Nami office building, [which]we acquired in June this year. Altogether it becomes the largest office complex in Riga with excellent CBD location, impressive scale, and more than 25 thousand square meters of further development potential.”

SG Capital Partners Fund I KS is a commercial real estate fund managed by investment management company SG Capital Partners AIFP (SG Capital). The fund makes investments in cash flow generating retail and office real estate projects in the Baltic states.

The Ellex Klavins team was led by Partner Ivars Pommers and included Partner Inita Jurka and Associates Ineta Kanepe and Zane Miglane. 

The Fort Legal team consisted of Associate Partner Uldis Judinskis and Senior Associate Edgars Turlajs.

Vilgerts has successfully represented the Moller group companies in Latvia’s Administrative Regional Court in a challenge to a EUR 7.4 million fine levied on the company by Latvia’s Competition Council.

The fine on the distributor of VW cars was, according to Vilgerts, the highest ever imposed by the Competition Council on one group of companies. In its judgment of November 22, the Administrative Regional Court found that the Competition Council had failed to prove its case, noting, among other things, that the sanctioned actions had not been established as harmful to competition in the case law of the EU courts.

According to Vilgerts Partner Debora Pavila: “There is hope now for Latvian competition law. Up to date the decisions of the Competition Council were virtually untouchable. Law cannot develop in such circumstances.”

In addition to Pavila, the Vilgerts team included Partner Julija Jerņeva, Senior Associate Katrine Plaviga, and Associate Janis Sarans.

Skrastins & Dzenis has successfully represented the interests of DLV and provided legal assistance in a dispute between shareholders of the company, helping the founders regain full control.

DLV is a gaming software and equipment manufacturer, which Skrastins & Dzenis describes as “well-recognized in Latvia’s gambling business.

The Skrastins & Dzenis team was led by Senior Partner Aivis Dzenis and included Partners Vigo Krastins and Andrejs Guļajevs.

Skrastins & Dzenis has successfully represented the interests of LLC Mile Auto — Citroen’s official dealer in Latvia — in a challenge to an to open tender for purchase of vehicles worth in excess of EUR 300,000.

According to Skrastins & Dzenis, “by the decision of the Public Procurement Bureau the other party’s complaint was dismissed and the public purchaser was granted a permit to sign a procurement contract with Mile Auto as the winner of the open tender.

The Skrastins & Dzenis team was led by Senior Partner Verners Skrastiņs and included Partner Andrejs Guļajevs.

Sorainen has represented Swedish company Bergvik Skog in the EUR 324 million sale of its forest properties in Latvia to another Swedish company, Sodra. Fort Legal advised Sodra on the sale, which was carried out by divesting Bergvik Skog of its subsidiaries in Latvia.

The acquisition includes all shares in SIA Bergvik Skog and SIA Ruda and includes the forestry organization, which has 24 employees. The total area of Bergvik Skog Latvian properties is 111,100 hectares, of which 80,300 are forest land. Sodra already owned 15,000 hectares of forest land in Latvia.

According to Sorainen, “in its ten years of operations, Bergvik Skog has established and developed Latvian forest properties. In Latvia, the organization has grown with a vision of creating long-term values and high environment, efficiency and forestry ambitions. Interest in this transaction was immense, [and] the sales process involved many serious and significant players.”

“This investment will secure some of our need for forest raw material,” said Sodra President and CEO Lars Idermark. “It will improve the structure of our wood imports by complementing our members’ wood deliveries and strengthening Sodra’s competitiveness.”

“The new holding is also a good capital investment as a base for Sodra’s future development, which obviously benefits our 51,000 members,” said Lena Ek, Chair of Sodra.

The Sorainen team was led by Latvia Managing Partner Eva Berlaus, working with Senior Associate Janis Bite, Associate Natalija Sestakova, and other specialists. 

The Fort Legal team included Partner Janis Likops, Senior Associates Roberts Prusis, Ieva Balcere, and Arturs Caics, and Associates Laila Pudule, Liene Lazare, Vita Rancane, and Kalvis Engizers.