RUSSIA: End in sight for Baltika's Belarusian battle
The Belarusian government may have broken the deadlock with Russian brewer Baltika that has bought the privatisation of the Belarusian brewery Krynitsa, Baltika said in a press statement Thursday.
The Belarusian government has issued a draft investment agreement, which sets the terms for Baltika's participation in the privatisation and Baltika is expected to reply to the proposal agreements, which guarantees the return of Baltika's investment into Krynitsa, within two weeks, Baltika said.
No further details of the agreement were available.
Baltika announced plans to expand in Belarus last year by taking control of Krinitsa beer company, which has up to 40% of the beer market.
But a bitter war of words erupted between the brewer and the Belarusian government when Baltika said the government had failed to meet the conditions of the agreement and refused to give a controlling stake in the Krinitsa brewery in the agreed terms.
"We have incurred big risks. We cannot invest money anymore just like this, without receiving the shares in the plant. We will ask the government to return the money," a Baltika spokesman said at the time said.
Baltika was meant to buy 50% in the brewer for US$50m, a deal that was meant to be finalised in December.
But the government, which owns an 81% of the beer producer, blocked a decision on a new share issue and froze the sale of the controlling stake to Baltika.
Baltika, then launched legal proceedings in its bid to recover the US$10m investment. While the Belarusian government hit back by threatening to ban Baltika, along with every other Russian company, from investing in the country.
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