Category: Lithuania

Former Ellex Valiunas Senior Associate Donata Montvydaite has left that prominent Lithuanian firm to become Group General Counsel at the Eastnine AB real estate investor.

Eastnine, known until May 2017 as East Capital Explorer, is a Swedish investment company founded in 2007 focusing on commercial real estate in the Baltic capitals. Its operations consist of three segments: Real Estate Direct, Real Estate Funds, and Other Holdings, and according to the Eastnine website, “the aim is to transform into a pure real estate company by the end of 2020.” Eastnine is listed on Nasdaq Stockholm, Mid Cap.

Montvydaite began her career as a lawyer as a Junior Associate in 2013 with Ellex (at the time, in Lithuania, doing business as LAWIN), after graduating from Vilnius University. According to her, “for over 5 years I have worked at Ellex with real estate investment and transactions, mostly cross-border deals with international counter-parties. I am honored to be appointed as GC for Eastnine to share my experience in real estate investment business from the legal side. Eastnine is one of the largest investors into Baltic commercial real estate. Eastnine aims to take leading positions in ownership of A class commercial properties in prime locations in Vilnius, Riga, and Tallinn and I will be pleased being part of it.”

Sorainen has advised Henkell & Co.-Gruppe, a Germany-based international producer and distributor of alcoholic beverages that belongs to the Oetker Group, on the acquisition of a majority stake in Filipopolis, an importer and distributor of alcoholic drinks in Lithuania. Glimstedt advised Filipopolis on the deal.

According to Sorainen, “the acquisition of Filipopolis in Lithuania completes the formation of Henkell & Co.- Gruppe’s distribution chain in the Baltic region.”

The Sorainen team was led by Partner Sergej Butov and Associate Laura Matuizaite.

Glimstedt Partner Kestutis Jaskutelis supervised the Glimstedt  team, assisted by Senior Associate Jurgita Zakarauskiene. 

Sorainen has successfully represented former board members of Investment and Business Guarantees – a company subordinate to the Lithuanian Ministry of Economy ‒ in a case concerning a bonus payment to a former manager of the company.

Lithuania’s Ministry of Economy brought an action against Investment and Business Guarantees’ decision to make the bonus payment to its former manager and claimed compensation for damage. The Vilnius City District Court decided in favor of the board members of the company, ruling that the decision by its board members to make the bonus payment of that particular amount was legitimate and based on an employment contract with its former manager as well as on the company’s results.

“The court ruling unambiguously dispelled the ungrounded doubts shared in the public space by the former Minister of Economy regarding company board decisions,” said Gediminas Norkunas, Investment and Business Guarantees’ former interim board chairman, who was one of the defendants in the case. “The court ruling is also important because it fundamentally acknowledges the independence of the board members and their duty to act in accordance with company – and thus also state – interests, but not the interests of an individual politician.”

Investment and Business Guarantees was represented by Sorainen Partner Zygimantas Pacevicius and Senior Associate Jurgita Karvele.

“In Lithuania, we see a lot of movement and changes at the biggest law firms these days,” reports Irmantas Norkus, Managing Partner at Cobalt in Vilnius, adding that many senior partners have recently decided to leave their old firms, either to change offices or to establish new ones.

“It seems that we are at a point where important, key people from big firms, after 15-20 years of work, are now reconsidering their careers, and looking for new opportunities,” Norkus says. “Just to mention a couple: Tomas Milasauskas, a key real estate partner, has left Ellex; Gintautas Bartkus, one of the founding partners of TGS Baltic, has left that firm to become the Head of Legal at Deloitte; and Renata Berzanskiene, a founding partner of Sorainen’s Vilnius office, is leaving that firm.” According to Norkus, this represents a clear generation change in the legal market, with more senior partners deciding to move forward, leaving space for younger lawyers.

There are other changes as well. “In my view, younger lawyers are changing the environment of legal firms,” Norkus says. “They are more liberal in terms of their dress code, and many of them are willing to work from home. In other words, they are changing the old-fashioned, conservative way of thinking about law firms.” He adds that his own law firm is trying to catch up with these trends, and on the day of our conversation, he reported, Cobalt was having an international costume day at the office, with everyone encouraged to wear their own national dresses or uniforms at work.

“This year our Bar Association Council will be re-elected,” Norkus says, “and we will have a new chairman and a new council.” He’s optimistic about the direction the Bar is moving in. “I think that we will have a new modern Bar that will further boost the activity of lawyers and take more care of legal trends and changes.”

Lithuanian law firm business grew around 15% in 2017, Norkus reports, and it has remained strong into 2018 as a result of the activity in the M&A market itself. “If we look at the M&A market,” he says, “which is a really significant part of our revenues, right now the Baltics have the most transactions in CEE. And in the first two months of 2018, we saw the largest number of transactions, with large M&A deals being signed or closed almost every week.”

In addition, the Cobalt Managing Partner says, crypto technology and blockchain work are keeping firms busy at the moment, with crypto transactions, ICOs, and payments being common topics among lawyers. “We have established a pan-Baltic group called the ‘Blockchain Task Force’ which is now working on larger projects in the field of cryptocurrency and related technologies,” he says. “This is definitely a new type of work for lawyers, which generates quite a lot of projects, and firms are just figuring out how to manage and monetize their clients’ requests.”

“Businesses in Lithuania are affected by the new Labor Code introduced in 2017,” he says, “and companies are still adjusting to its requirements. In addition, recent amendments to the tax laws and, of course, the GDPR are also generating business for firms.”

Finally, Norkus reports Lithuania is attractive for foreign investors at the moment. “Lithuania is attractive mainly to European investors,” he explains, “for they find a friendly environment here, and we have good governmental approaches as well. In the latest Ease of Doing Business rankings, Lithuania is No. 16.”

Tvins has advised Easy Debt Service, a Lithuanian debt management company, on a EUR 95 million loan portfolio purchase from the bankruptcy administrator of four credit unions: Vilniaus Taupomoji Kasa, Nacionaline Kredito Unija, Laikinosios Sostines Kreditas, and Svyturio Taupomoji Kasa. The seller was represented by ZRG.

Easy Debt Service, which launched its services in 2016, is specialized in medium and large debt recovery, as well as other administrative and legal services.

“The deal is important as the loan portfolio was very complex,” Tvins Partner Vytautas Senavicius, who led his firm’s team on the deal, commented. “It included business loans, consumer credit, consumer credit backed by collaterals/mortgage/ guarantees, business loans backed by collaterals/mortgage/ guarantees. The buyer took over a number of disputes in the court as well. Our assignment included the legal analysis of portfolio, consultations in every step of the purchase procedure, drafting and reviewing necessary documents for completing this deal; the project took more than seven months.”

ZRG’s team included Partners Marius Rindinas and Skomantas Grigas.

Sorainen has advised Valyuz on establishing a company in Lithuania and obtaining an e-money institution license from the Bank of Lithuania.

Sorainen reports that Valyuz is a fintech company “planning to provide a cutting-edge alternative solution to traditional banking and to become a platform-of-choice for international corporate clients in the technology sector,” and the firm says that “the company is planning to offer electronic money accounts, payment transactions via the SEPA payment system, issuance of payment instruments, and other services.”

Sorainen provided legal advice on establishing the company and structuring its equity capital, and it assisted in concluding a shareholders agreement. They also advised Valyuz on the licensing procedure and represented the company at the Bank of Lithuania.

The Sorainen team included Partner Augustas Klezys and Associates Urte Armonaite and Inga Macijauskaite.

Sorainen Lithuania has advised NanoAvionics, a satellite manufacturer, on securing an investment from Avellan Space Technology & Science to support the expansion of the company’s global operations.

Under the terms of the investment, AST&Science has acquired all shares from venture capital firm Practica Capital and made an additional investment in NanoAvionics’ capital assets.

AST&Science is a designer and manufacturer of miniature satellites for low-Earth orbit. NanoAvionics is a small satellite platform manufacturer and mission integrator. Over the past few years, the company has implemented over 40 satellite missions. According to Sorainen, NanoAvionics has sold its products to customers in 20 countries, obtained innovation grants from the European Commission, and won a contract with the European Space Agency.

Sorainen’s Lithuanian team was led by Partner Laimonas Skibarka and Associate Vytautas Sabalys, and included Associates Ignas Motiejunas, Juliana Pavilovska, and Laura Matuizaite.

Motieka & Audzevicius has defended the interests of Uzstato Sistemos Administratorius, a public non-profit deposit system administration institution, in a contractual dispute at the Court of the Appeals in Lithuania.

The claimant, a manufacturer of soft drinks and alcoholic beverages, claimed that the reverse vending machines, administered by Uzstato Sistemos Administratorius (USA), did not accept the packages it used and demanded compensation for the alleged damages.

Motieka & Audzevicius established that the claim was groundless and that USA had no obligation to make the payments the claimant demanded.

The Motieka & Audzevicius team included Senior Associate Justinas Jarusevicius and Junior Lawyer Paulius Grendelis. 

Motieka & Audzevicius has advised Wisdom Events, an event and business meetings organizer, on a cross-border swap of shares that involved partners splitting into different jurisdictions.

Half of the share portfolio in Wisdom Events’ Russian business has been swapped for a 50% share portfolio in the Lithuanian business. As a result of the transaction, Wisdom Events has become the sole owner of the Lithuanian company, and left the Russian company. 

The Motieka & Audzevicius team responsible for the negotiations process, coordination of processes abroad, preparation of documentation, and title registration matters was led by Partner Giedrius Kolesnikovas and Senior Associate Michail Parchimovic.