Administrative Regional Court partly satisfied the claim that Euromin Holdings (Cyprus) Limited (Euromin), a company of Vitol Group, had filed against the Latvian financial regulator, the Finance and Capital Market Commission (FCMC), in a dispute over the price of shares in Ventspils Nafta holding company in the mandatory buyout offer, the court said.
Euromin claimed a €7.027 million compensation from the FCMC, insisting that the mandatory buyout price set by the financial regulator had been too high.
The court satisfied the claim partly, ruling that the FCMC decision dated October 15, 2015, about the mandatory buyout price for Ventspils Nafta shares was unlawful and the watchdog should compensate Euromin for its loss in the amount of €3.618 million. But the court rejected the part of the claim concerning other losses.
The parties to the dispute now have a month to make a procedural appeal against this ruling to the Administrative Cases Department of the Latvian Supreme Court.
LETA was told at Ventspils Nafta that the Euromin had filed its claim, insisting that the regulator's assessment of the share price was wrong and inconsistent with International Financial Reporting Standards (IFRS) and the EU requirements.
Robert Kirkup, Chairman of the Management Board of Ventspils Nafta, said that the court ruling requiring consistent application of IFRS in Latvia was vital to bring foreign investments to Latvia as it would make the existing and potential investors feel safe about their investments.
But as the court satisfied the Euromin claim only partly, the company will consider filing the procedural appeal in respect of the size of the compensation awarded to it by the court.
The FCMC said it was also going to file an appeal but declined any detailed comments.
As reported, on January 14, 2016, the court decided to start an administrative proceeding based on the Euromin claim for a €7.027 million compensation from the FCMC in relation to the dispute over the price of Ventspils Nafta shares in the mandatory buyout offer.
Following a transaction in September 2015 in which Euromin bought 43.25% of shares in Ventspils Nafta from Latvijas Naftas Tranzits for €79.98 million, increasing its holdings in the company to 93.24% of the total number of voting shares, Euromin was required to make a mandatory buyout offer to the remaining shareholders of Ventspils Nafta. Initially, Euromin wanted to offer €3.12 per share but the FCMC insisted that the price must be as high as €4.56 per share. The regulator also asked the police to investigate possible insider trading in Ventspils Nafta shares.
At present Euromin is the sole owner of Ventspils Nafta.
Ventspils Nafta is the central holding company in a transit-oriented group whose task is to manage the investments in its subsidiaries. Ventspils Nafta operates in the following areas: transshipment of crude oil and petroleum products; transport of crude oil and petroleum products by pipelines and shipping.