OREANDA-NEWS. January 20, 2011. JSC Latvijas Kugnieciba (LK) as the sole owner of “LASCO Investment” Ltd (LI) believes that the administrator of LI and other administrators of the LI Group have acted contrary to the law, in order to take over and control properties worth many millions of Lats. Administrators of companies of the LI Group are Zigurds Krastins, Elvijs Vebers, Kristaps Andersons and Janis Esenvalds.

To prevent the new Management Board members of LI and its Group’s subsidiaries, elected by the new Management Board of LK on December 22, 2010, from exercising  their legal functions, the administrators of LI and other administrators of the LI Group are not giving approval to register the new Management Board members in the Commercial Register of the Republic of Latvia. Therefore, the administrators are unlawfully preventing the new LK Management Board from being able to manage their assets in the LI Group, thus causing substantial damages to the LI Group’s creditors, the LK Group and its shareholders, including the State.

LK believes that the administrator O.Cers failed to issue consent for the registration of the new LI Management Board in the Commercial Register of the Republic of Latvia with a view to stopping the new LI Management Board from participating in the court hearing on January 3, 2011, where the court resolved to declare insolvency proceedings of LI. Contrary to the interests of creditors of LI, including LK’s subsidiary Latmar Holdings Corporation, which is the largest creditor of LI, the Administrator O.Cers maintained the announcement of insolvency proceedings in court. The administrator O.Cers acted this way irrespective of the fact that the creditors of LI had agreed on amendments to the program of out-of-court legal protection proceedings and on restructuring the debt. Possibly the only objective of O.Cers actions is to prevent the new LK Management Board from taking over a valuable asset of LK.

“We have reasonable suspicions that insolvency of LI and the out-of-court legal protection proceedings of its related companies was artificially organized. All creditors, except VN, are companies of the LK Group. LK Group’s company is also Wilcox, which is indicated as the potential investor of LI. We believe that the out-of-court legal protection proceedings of LI were initiated with the sole purpose being to appoint through agreement such administrators who are loyal to the previous LK Management Board,” says the Chairman of the Management Board of LK Paul Thomas, who emphasized that the primary objective is to defend the interests of LI creditors.

LK holds a view that announcement of insolvency proceedings had no factual grounds and the administrator acted unlawfully. Further evidence confirming this point is that irrespective of the fact that the administrator O.Cers was informed that VN was ready to postpone the payment of its debt until December 31, 2011, he still filed an insolvency application in court on the same day that the LK Management Board and Supervisory Council was re-elected on December 17, 2010.

LK has filed a application to the Prosecutor General of the Republic of Latvia by requesting submitting of the protest  on the court’s decision on declaring insolvency of LI. Furthermore complaints to the Insolvency Administration on actions of the administrators O.Cers, Z.Krastins, K.Andersons, E.Vebers and J.Esenvalds has been submitted.