Category: Latvia

Ellex has advised SBA Group company Urban HUB Investments on its EUR 8 million public bond issuance to support Urban HUB, “the largest office, retail, and warehouse project in the Baltic States, near Kaunas.”

According to Ellex, the interest rate of the bonds is 10.75%, to be paid quarterly. The minimum investment amount was EUR 10,000. The bonds were offered to private and institutional investors.

“The offering was planned in tranches but, due to high demand, all of the bonds of the issue have been issued in one single tranche,” the firm reported.

The Ellex Valiunas team included Partner Robertas Ciocys, Associate Partner Egle Neverbickiene, and Associate Ainis Augustas Petrulis.

Ellex has advised on Orkla’s opening of a new EUR 100 million biscuit and wafer production plant in Adazi, Latvia.

Orkla is a producer and supplier of fast-moving consumer goods in the Baltic states.

According to Ellex, the new production plant is the largest specialized biscuit and wafer production plant of this type and the largest newly built Orkla production plant with the aim of producing products for both the local Latvian market and the entire market of Northern Europe. “Almost EUR 100 million have been invested in its construction and technological equipment, which is the largest investment in the Latvian food production industry of recent years.”

In 2022, Ellex advised on Mantinga’s acquisition of Fresh Food Production from Orkla (as reported by CEE Legal Matters on October 10, 2022).

The Ellex team included Partner Ivars Pommers, Senior Associate Inese Freivalde, and Associate Ineta Kanepe.

Cobalt has advised Schwenk Latvija on its long-term power purchase agreement with BaltCap Infrastructure fund and AJP Capital Solar Core Plus fund joint-venture PV Power.

The power plant at the core of the agreement was commissioned on September 15, 2023, has a total capacity of 6.5 megawatts, and is located in the city of Broceni, Kurzeme region. It is scheduled to produce upwards of 6,000 megawatt-hours of green electricity per year and provide approximately 4.5% of Schwenk Latvija’s annual electricity consumption.

According to Cobalt, “the electricity generated at Broceni will reduce Schwenk Latvija’s environmental impact by more than 1,600 tons of carbon dioxide emissions annually. The agreement signed by Schwenk Latvija is currently one of the largest single-company power purchase agreements for green electricity in Latvia.”

Schwenk Latvija is part of the Schwenk Building Materials Group, the oldest family-owned building materials company in Europe and a leader in innovation, according to the firm.

The Cobalt team included Partner Gatis Flinters and Senior Associate Martins Tarlaps.

Cobalt has advised Italian company Italferr on its successful participation in the EUR 141.5 million Rail Baltica public procurement process for the provision of engineering consultancy and construction supervision services for the construction of the mainline in Latvia.

According to Cobalt, Italferr is the engineering consultancy arm of the Italian State Railways Group Ferrovie dello Stato Italiane, with more than 30 years of experience in large-scale infrastructure projects, including the implementation of the Lyon-Turin, California, Texas, Cairo, and Saudi Arabia high-speed rail lines.

Under the contract, Italferr will supervise the engineering works during the construction and warranty period of the 230-kilometer double-track high-speed line in Latvia. The same company is also engaged in the implementation of the line-wide electrification and signaling sub-systems of Rail Baltica.

The Cobalt team included Managing Partner Dace Silava-Tomsone, Partner Sandija Novicka, and Associate Arturs Valdersteins.

TGS Baltic has advised the Modus Asset Management-operated Clean Energy Infrastructure Fund on the acquisition of a 55-megawatt portfolio of solar projects in Latvia from developer Evecon, via the Clean Energy Investments special purpose vehicle. Sorainen reportedly advised Evecon on the deal.

Modus Asset Management is a Lithuanian renewable energy investment manager.

Evecon is a renewable energy developer in the Baltic States.

According to TGS Baltic, the projects are currently in the development phase. “This is one of the largest project portfolios in Latvia, which will use single-axis solar tracking and fixed-angle technologies. Currently, the portfolio is close to the ready-to-build stage. WiSo Engineering, an Evecon group company, will provide complete engineering, procurement, and construction services. The projects are expected to be commercially operational in the first half of 2024.”

The TGS Baltic team included Partners Agnese Hartpenga and Aurimas Pauliukevicius and Associates Evija Abele and Elina Lesnicenoka.

Ellex Klavins has advised Merito Partners on the set up of its first alternative investment fund – the Merito Sustainable Energy Fund I AIF – and on its acquisition and development, together with Saules Energy, of seven photovoltaic power generation projects, two of which became operational in July and August 2023.

According to the firm, the Zilupe solar power plant, launched in July 2023, will provide power to at least 1300 households. The Incukalns solar power plant in the Valmiera region, launched in early August, is “the largest solar power station up to date in Latvia […] It will supply almost 4,000 households with electric power.”

Saules Energy is an engineering and development company developing photovoltaic power generation plants. It is the partner of the Merito Sustainable Energy Fund I AIF in the acquisition and development of the seven power generation plants.

According to Ellex, Merito Partners contemplates installing eight major-scale solar power plants in total by investing around EUR 50 million in green energy projects. The “solar power plants developed by Merito Partners will be capable of generating at least 70,000 megawatt-hours of electricity per year, supplying green energy to more than 35,000 households in various regions of Latvia.” Four more projects are expected to launch this year, with another two in 2024.

Back in January, Ellex had also advised on the initial setup and launch of the Merito Management AIFP alternative investment fund structure in Latvia (as reported by CEE Legal Matters on January 18, 2023).

The Ellex team was led by Partner Ivars Pommers and included Associate Partner Marta Cera, Senior Counsels Zane Bule-Mitka and Eduards Dzintars, and Associates Kristers Toms Losans, Marats Golovkins, Ineta Kaņepe, and Niklavs Zieds.

Cobalt has successfully represented Germany’s Bauer Spezialtiefbau before the Administrative District Court in a dispute related to a VAT refund for the company against the State Revenue Service of Latvia.

According to Cobalt, on August 4, 2023, the Administrative District Court ruled in favor of Bauer and ordered the State Revenue Service to refund the value-added tax along with late payment interest of over EUR 300,000.

Bauer AG is a German construction and machinery manufacturing company.

“The dispute centered around the decision by the State Revenue Service that Bauer, as a taxpayer from another EU member state not conducting economic activity in Latvia, was not entitled to a tax refund for services received in Latvia from another registered taxable person associated with the construction of real estate,” the firm reported.

The Administrative District Court, on the other hand, determined that Bauer had met the necessary conditions for entitlement to a VAT refund and that the State Revenue Service could not prevent Bauer from exercising this right simply because it was not registered in the VAT payer register in Latvia, according to Cobalt. “The court dismissed the State Revenue Service’s allegations regarding Bauer’s fixed establishment in Latvia. The State Revenue Service did not appeal the decision, which has now taken effect.”

The Cobalt team included Partner Sandija Novicka, Specialist Counsel Sabine Vuskane, and Associate Gabriela Santare.

Cobalt has advised the Astor Group on its EUR 25 million loan from Rietumu Banka to support the development and operation of its hotel properties in Riga.

Astor Group is a group of Latvian companies that have been developing real estate for hotels in varying market segments under the Radisson brand for over 20 years.

The Astor Group companies involved in the deal manage the Radisson Blu Daugava, Radisson Blu Ridzene, Park Inn by Radisson Valdemara, Park Inn by Radisson Residence Riga Barona, and Radisson Hotel Old Town Riga. “The financing was provided for both the company’s working capital, future development, and refinancing of current liabilities,” Cobalt reported.

According to the firm, there are plans to renovate certain properties and expand their functions in the near future, while the company intends to enhance the infrastructure of the existing properties to achieve a more sustainable use of energy.

The Cobalt team included Partner Toms Sulmanis and Senior Associate Inga Tenisa.

Cobalt has advised Change Ventures on leading a EUR 3.6 million investment round into Latvian advertising experience platform Monetizr, with the participation of Techstars and Ludus Ventures.

According to Cobalt, Monetizr offers a “revolutionary in-game advertising platform that enhances the mobile gaming experience. The company focuses on assisting brands to reach, engage, and convert over 300 million global mobile gaming consumers.” The start-up works with major consumer brands like Procter & Gamble and top game developers like Voodoo Games.

Monetizr is now headquartered in Atlanta, the US. It will use the funds to scale up its US sales team and build out its European development hubs in Riga, Helsinki, and London.

“Brands are struggling to reach consumers, especially Gen-Z and women, who now spend a lot of time playing games, a media channel that has traditionally been hard to access efficiently,” Change Ventures stated when announcing the investment. “The current dominant advertising format, a short video ad, is disliked by both consumers (because it disrupts gameplay) and game publishers (because a successful ad takes the player away from the game). Monetizr’s solution is to deliver in-game advertising experiences that are integrated into the gameplay, deliver rewards tied to progress in the game or based on additional consumer actions (e.g., providing email opt-in), and do not remove the player from the game. It turns out that this is exactly what major brands are looking for. The team is now able to demonstrate exceptional consumer engagement.”

The Cobalt team included Partner Toms Sulmanis, Senior Associate Agnese Gerharde, and Associate Vadims Zvicevics.

Njord has advised Latvia’s University College of Economics and Culture on the topic of intellectual property protection issues related to student works created within the “Innovation grants for students in interdisciplinary fields of art, culture, economics, and IT (MaKE IT)” European Regional Development Fund project.

Njord reported having assessed whether the works – “written descriptions, drawings, audio recordings, blueprints, designs, and other types of objects: fundamental research, industrial research, and experimental developments – developed by the university and its students within the framework of the first phase of the European Regional Development Fund project can potentially be recognized as intellectual property rights objects.”

The firm also advised on who those IP rights would belong to: students, university staff, the university itself, or shared between the parties mentioned; and how the protection of the specific potential intellectual property objects could be implemented.

EKA, the University College of Economics and Culture, is an international, accredited private higher education institution in Riga.