Ternopil agricultural holding "Mriya" is on the verge of bankruptcy
Ternopil - Kyiv, December 19 (Navigator, Vladimir Mikhailov) - Shareholders and creditors of the Mriya agricultural holding said that they provided the Ukrainian company with their plan for restructuring about $1 billion of its debt. They invited the agricultural holding to hire a chief restructuring officer and provided it with “detailed proposals” that should help avoid bankruptcy, according to a letter from investment banking company NM Rothschild & Sons, their financial adviser. Tensions between management and creditors have been growing since Mriya said in August that it had missed payments on some of its obligations, writes Bloomberg.
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Mriya is finding it increasingly difficult to service its debt as the Ukrainian government's conflict with pro-Russian rebels in eastern regions plunges the country's economy into its deepest recession since 2009. The company, whose headquarters is in Ternopil, this week announced the departure of its financial director Alexander Chernyavsky. It also said it was prepared to cede control to creditors if they agreed on a restructuring plan by the end of the year.
The letter from NM Rothschild & Sons also said that the company and its shareholders have decided to avoid such a restructuring process, which increases the likelihood of declaring bankruptcy. “This is contrary to the wishes of the creditors' committees,” the letter states.
Creditors must reach an agreement on restructuring by the end of the year, otherwise the agricultural holding will have to cut jobs and begin bankruptcy proceedings for some divisions, Mriya said on December 16.
Bloomberg also reports that it has not yet been possible to obtain a comment from the agricultural holding on the creditors' statement by telephone and mail.
In October, the company's international bondholders, including Ashmore Investment Management Ltd., T. Rowe Price Associates Inc., and CarVal Investors, sent a letter to Ukrainian authorities asking them to open an investigation into the company's owners.
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