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Tuesday 20.03.2018 | Name days: Made, Irbe

Board of Privatization Agency resigns prior to signing of Citadele Bank’s sale

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Baltic news, News from Latvia, BNN.LV, BNN-NEWS.COM, BNN-NEWS.RUChairman of Privatization Agency Ansis Spridzans and Board member Guntis Lausks have left their posts. They are the ones who were supposed to sign the contract on the sale of Citadele Bank this Friday, October 31st.

This Wednesday, Latvian Economy Minister Vyacheslav Dombrovskis received resignations of both Spridzans and Lausks. It is planned that a meeting of PA shareholders will be called this Thursday, October 30th, in order to decide on future actions.

PA public relations manager Guntis Karklins could not provide any detailed comments as to why those two officials decided to leave their posts. When asked if this situation could have an impact on the signing of the Citadele Bank sale contract, Karklins explained Economy Ministry has the authority to find a temporary solution.

As previously reported, the Latvian government has supported the recommendation proposed by financial consultant Societe Generale in regard to the sale of Citadele Bank’s shares to American Ripplewood Advisors LLC. It is planned to sign the sale contract this Friday.

PA notes the base price for all Citadele Bank shares is EUR 98.67 million. The contract provides for Latvia being paid EUR 74 million for 75% of shares. Another condition of the contract provides for not allowing investors to sell said shares for at least two years.

After the meeting of the government, Spridzans refused to reveal details of the contract. The only thing he said is that all conditions will be made known once the contract with Rupplewood Holdings has been signed.

PA Commercial Activity Manager Vladimir Loginov has said that the government does not plan to carry out any additional changes to the contract. «The contract has been supported and it will be signed,» – said Loginov.

According to data compiled by the Latvian Privatization Agency, Citadele Bank has been provided with state support worth a total of EUR 377.9 million. The total remaining state support in the bank is EUR 174.2 million. The bank has paid back EUR 203.7 million so far. This includes interest rate at EUR 46.32 million. With that, state support in the bank has declined by EUR 250 million and is EUR 127.9 million.

Latvia currently owns 75% minus one Citadele Bank share. 25% plus one share is owned by the European Reconstruction and Development Bank.

The Latvian government has accepted the American Ripllewood Holdings’ proposed offer to buy Citadele Bank. It provides for the sale of 25% of Citadele’s shares to Ripplewood Holdings, 50% to currently unnamed investors and 25% of shares to remain owned by ERDB.


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