High Economic Court confirms that UISE owes Rubizhne cardboard packaging plant UAH 13 million

Apr 08, 2005. /Lesprom Network/. The High Economic Court upheld the Kyiv Economic Court's ruling that ordered the Ukrainian International Stock Exchange (UISE) to return UAH 13 million in guaranty deposit to the Rubizhne cardboard packaging plant (Rubizhne, Luhansk region). The press service of the plant disclosed this to Ukrainian News. "The panel of judges rejected the exchange's appeal and upheld the decision of the court of first instance, according to which the UISE is to return a guaranty deposit to the Rubizhne cardboard packaging plant," the press service quoted the plant's Deputy Director-General Oleksandr Liamzin as saying. According to the press service, Deputy Prosecutor-General Oleksandr Medvedko said during a meeting with representatives of the Rubizhne cardboard packaging plant on April 6 that he intended to transfer the criminal case alleging illegal privatization of 20% of the shares in the plant, fraud, and abuse of office from the Obolonskyi district prosecutor's office (Kyiv) to the Prosecutor-General's Office. As Ukrainian News earlier reported, the Rubizhne cardboard packaging plant recently said that it was in danger of defaulting on its loan agreement with the European Bank for Reconstruction and Development because the UISE's failure to return UAH 13 million to the plant. In February, the Obolonskyi district prosecutor's office filed a criminal case alleging illegal sale of 20% of the shares in the Rubizhne cardboard packaging plant on the UISE in September 2004 as well as fraud and abuse of office. The state-owned Ukrbumprom company sold 20% of the shares in the Rubizhne cardboard packaging plant for UAH 13.27 million on the UISE on September 24, 2004. Representatives of the plant were not allowed to bid for the shares despite the fact that the plant paid a deposit of UAH 13 million for participation in the transaction. The 20% stake was eventually bought by Richmon Commercial Ltd., which is registered in the British Virgin Islands. The Rubizhne cardboard packaging plant specializes in production of paper for corrugation, corrugated cardboard, and packaging made of corrugated cardboard. It has a 30% share of the Ukrainian market of corrugated products. The plant ended the year 2003 with a net profit of UAH 51.677 million. Its net revenues increased by 28.5% to UAH 315.843 million in 2003, compared with 2002. The Rubipak company (Rubizhne, Luhansk region), which is controlled by the Rubizhne cardboard packaging plant's Director-General Hennadii Minin, sold its 40.14% stake in the Rubizhne cardboard packaging plant to a nonresident individual in November 2004. According to the Agency for Development of the Stock Market's Infrastructure, DSS Eastern Europe Limited (Great Britain) owned 34.8% of the shares in the Rubizhne cardboard packaging plant as of November 2004 while Richmon Commercial Ltd. owned 20%.