URALCHEM, JSC expresses its serious concern about the suspension of Tomet LLC production activities and the possible bankruptcy of this enterprise.
Tomet LLC is a legal entity that owns an ammonia unit and a methanol production complex. Until 2005, these assets were part of the integrated production complex of Togliattiazot (ToAZ), and later they were transferred to Tomet LLC owned by a Hong Kong offshore company Triumph Development Limited, which, as the court found, is controlled by one of the ToAZ beneficiaries, a Swiss businessman Andreas Zivy. Currently, these production assets are used by ToAZ under lease agreements and serviced by ToAZ employees.
According to the verdict of the Komsomolsk District Court of the City of Togliatti, which entered into force on November 26, 2019 through the appeal ruling of the Samara Regional Court, the beneficial owners of Togliattiazot, Vladimir and Sergey Makhlais, as well as Andreas Zivy, were found guilty of large-scale fraud (article 159.4 of the Criminal Code of the Russian Federation) and are obliged to compensate damage caused to Togliattiazot in the amount of 77.3 billion rubles and to the minority shareholder URALCHEM, which owns 9.97% of ToAZ shares, in the amount of 10.3 billion rubles. The court collected the same amounts from Tomet LLC as a joint and several defendant in a civil claim filed by URALCHEM within a criminal case.
On September 21, 2020, Togliattiazot initiated the bankruptcy procedure for Tomet LLC, sending a corresponding claim to the Arbitration Court of the Samara Region. Later, URALCHEM was forced to join the Tomet bankruptcy litigation as a claimant to recover damage.
Earlier, on September 3, 2020, writs of execution were submitted to the Federal Bailiff Service (FBS) to collect the debt from Tomet LLC. In this case, the funds are to be collected both in favor of URALCHEM and in favor of Togliattiazot, which also suffered from the fraudulent actions of the above-mentioned persons.
Within the framework of enforcement proceedings to recover damages, the FBS arrested the accounts of Tomet LLC as an interim measure.
Currently, the management of "Tomet" declares that the company cannot carry out its activities without access to the current accounts, that the activities of the company have been stopped and insists on the revocation of writs of execution to collect the existing debt from Tomet LLC.
For its part, URALCHEM is interested in the stable operation of the debtor; however, there is a danger of burdening the company with significant amount of accounts payable, which will make it difficult for URALCHEM to recover damages in the future.
The website of the Arbitration Court of the Samara Region posted a decision dated Sep-01, 2020 to recover more than 838 million rubles from Tomet in favor of Togliattikhimbank, which belongs to one of the convicts, Sergey Makhlai. In addition, the website of the Arbitration Court shows that the second bank, which, according to the available information, is owned by the Makhlais — RTS — filed a lawsuit in court to recover more than 808 million rubles from Tomet LLC. There is an obvious attempt to create significant accounts payable and then foreclose on the assets of Tomet LLC.
In such a situation, URALCHEM's withdrawal of the writs of execution would make it impossible for the company to enforce the court decision in the future.
URALCHEM, JSC declares that it is not interested in production stopping and bankruptcy of Tomet LLC. In this regard, URALCHEM, JSC will be ready to withdraw from the FBS the writs of execution against Tomet LLC, provided that the obligations of Tomet LLC are secured by a pledge of the debtor’s property, as well as the withdrawal of the Tomet bankruptcy petition filed by Togliattiazot.
The corresponding proposals were announced on October 30 at a meeting in the Ministry of Industry and Trade with the participation of representatives of URALCHEM JSC, Togliattiazot PJSC, and Tomet LLC.
Dimitry Tatyanin, Legal Affairs Director, URALCHEM:
“Submission of writs of execution and initiation of enforcement proceedings are measures aimed at compensation for damage and carried out within the framework of the effective legislation. Nevertheless, we will be ready to revoke the writs of execution if the interests of URALCHEM and Togliattiazot, aimed at the possibility of damages compensation in the future, are secured.
We are convinced that our proposals for resolving the situation are constructive and aimed at a prompt resolution of the problem created by the management and owners of Togliattiazot PJSC and Tomet LLC. We believe that the implementation of these measures will not worsen the position of Tomet LLC, but, on the contrary, will allow it to continue full-fledged production and financial activities, fulfill obligations to Russian and foreign partners and pay salaries to the company's employees. At the same time, the fulfillment of the obligations of Tomet LLC in the future will be secured, which will protect the interests of URALCHEM and Togliattiazot, in whose interests compensation for damages in a criminal case of fraud is made.“