Amber Beverage Group has initiated legal protection for its Latvian operations as it faces cash flow pressures caused by “external challenges”.
In a filing to the Nasdaq Baltic stock exchange on Friday (30 January), the company said Amber Latvijas Balzams will continue to operate as normal while it “works with creditors to establish a sustainable financial structure”.
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Normunds Staņēvičs, the CEO of Amber Beverage Group (ABG), called the decision “difficult but necessary”.
“The legal protection process gives us the legal safeguards we need to reach agreements with creditors and build a sustainable path forward,” he said.
The application covers only the Latvian production facility and warehouse. ABG said its sales and distribution businesses in other countries are not included and will keep trading as normal.
The decision in Latvia follows recent developments involving Stoli, which is owned by SPI Group Holding, also the majority shareholder of ABG.
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By GlobalDataLast month, Stoli announced plans to liquidate two US units – Stoli Group USA and Kentucky Owl Bourbon.
The Elit Vodka producer said it had asked the court to convert Chapter 11 proceedings, launched in November 2024, into Chapter 7 bankruptcy.
At that time, Stoli said since it denounced Russia’s invasion of Ukraine, authorities in the country had embarked on “the confiscation and nationalisation of Stoli’s state-of-the-art distillery”.
The company also reported that its operations had been disrupted by a “large-scale, sophisticated cyberattack”.
ABG has faced a similar fallout in Russia.
The group said Russian authorities designated its associated entities as “extremist” after it publicly backed Ukraine and European peace.
The combined impact of the cyber incident and cost of legal battles with the Russian Federation has excluded the company from several international markets, the Moskovskaya vodka owner said.
ABG also cited “significant headwinds” in global spirits markets over the past year as another factor influencing its decision.
According to the filing, the pressures led to “substantial” cashflow problems and delays in excise tax payments.
After extended talks with Latvia’s State Revenue Service (VID) over overdue excise obligations, VID froze the company’s bank accounts.
“This action made it impossible to continue operations without seeking legal protection.”
A court‑appointed independent supervisor will oversee the process.
The company will draft a “comprehensive” restructuring plan with creditors, which will be put to a vote and then require court approval.
Liabilities incurred before 30 January are frozen and will be dealt with under the plan.
Obligations from 30 January onward will be paid in the ordinary course of business with priority administrative status.
Employee salaries will continue to be paid as normal, the filing read.
ABG’s management aims to finalise and approve the plan by the middle of the year and exit legal protection in the second half of 2027.
The group stressed the legal protection application does not affect the parent company. Global sales and distribution activities will continue as normal, it added.
ABG operates across Europe, Australia, Mexico and the UK.
Its fully owned brand portfolio includes Moskovskaya vodka, Rooster Rojo Tequila, Writers’ Tears whiskey and Riga Black Balsam, which it sells in over 70 markets.
The company also manages and distributes over 1,400 third‑party brands.
In the third quarter of last year, ABG’s net revenue fell 17.9% year on year, to €142.8m ($169.2m), though profitability improved.
Gross margin rose from 29.5% to 30.4%, supported by “production cost optimisation and favourable sales product mix”, the company said in a November filing.
Operating profit increased to €7m, including a €4.4m gain from the sale of a Lithuanian warehouse in March.
