Stories of the most high-profile bankruptcies of recent times.
In the first half of 2022, several hundred companies were knocked out of the Belarusian business by external and internal circumstances. The Office Life news publisher looked into the Unified State Register of Bankruptcy Information and compiled a list of once fairly well-known legal entities that are completing the liquidation process, seeking a protective period against claims and settling creditors’ claims.
It is worth saying that the deterioration of the economic environment and the tightening of sanctions are increasingly causing the bankruptcy of Belarusian businesses. The French company Coface, which specializes in risk insurance, has already reacted to this: in the second quarter, Belarus moved from the group of countries with a ‘high risk’ of corporate defaults to a dangerous zone with a ‘very high’ probability.
Now Belarus, Ukraine, which was already under this threat, and Russia, which was lowered by two steps at once in three months, have one step left to the bottom according to the classification of the French, the “damn dozen” of countries with an extreme level. It now includes North Korea, Syria, Iraq, Venezuela, Afghanistan, Kosovo, Libya, Cuba, Yemen, Sudan, Eritrea, Burundi and Zimbabwe.
Miran-Perfume LLC and Dokshytsy Miran-Perfume LLC
One of the pioneers of domestic perfume production, created by the late businessman Mikolai Bakach, operated under the Miran-Parfume brand for almost 30 years. Do you remember his cheap brands Magic Guard, Angels, Chances or Diplomat? The company also recently produced repellents.
In the spring of last year, the liquidation of both Mirans began, and during this year, due to debts that cannot be satisfied, bankruptcy proceedings were initiated and opened in cases of simplified bankruptcy of both legal entities.
According to court materials, Dokshytsy Miran-Perfume LLC’s liabilities to creditors amount to over 473 thousand rubles (with assets of 219.5 thousand rubles). Dokshytsy Miran-Perfume LLC, in turn, filed for bankruptcy of Miran-Perfume LLC, which owed it almost 70,000 rubles. In total, Miran-Perfume LLC must pay about 2 million rubles to its creditors. There is the only thing, as indicated in the case file, the company has no money and property.
Gersis Software LLC
This company is one of the pioneers of the Belarusian IT industry: Gersis Software LLC was established in 2008 and became a resident of the High Tech Park (HTP) in 2012.
Its key activity was the development of software and various products for its owner SIS Group International. This group, under Uladzimir Lakhtenkou management, specialized in the import and production of telecommunication equipment, the construction of telecommunication systems, and the development and distribution of IT products. SIS Group International even tried to launch tablets under the Flycat brand.
Risky contracts in Transcaucasia led to the collapse of their business, and Gersis Software LLC was affected. In 2020, the company was excluded from the HTP, and started a liquidation process at the request of one of its creditors. They had to start bankruptcy proceedings in 2022 due to the fact that the assets of Gersis Software LLC were not enough to satisfy the requirements of the creditors.
Izospan LLC is another bankrupt company from the once-powerful Isobud Group, created by businessman Ihar Cherny to produce and sell metal structures for prefabricated premises.
According to information from the case files, it has been insolvent since 2016 and has been in liquidation since 2021. The Economic Court of Minsk issued a decision declaring its economic insolvency in mid-June of this year. At the same time, the deadlines for completing the liquidation of the former resident of the FEZ Mogilev were determined, it is mid-2023.
According to the case file, Izospan LLC owes its creditors, including employees, over 3.5 million rubles, 16.2 million Russian rubles and 19.1 million euros. At the same time, all its assets amount to about 9 million rubles, and part of the property still needs to be returned from another site of the group (Izobud-South is also in the process of bankruptcy) in the city of Volzhsky in Russia.
Vysoki Zamok ALC
By the end of its 20-year history, the Vysoki Zamok ALC construction organization accumulated considerable debts. The company, created with the involvement of Lithuanian investors, is known for participating in a number of high-profile construction projects in our country: the Bonus Shopping Mall, the ProStore Hypermarket, and the Zorka Jewelry Factory, stores for Eurotorg and Rodnaya Storona. Also, Vysoki Zamok ALC took part in the reconstruction of the Minsk Fabrika-Kukhnia.
At the time of the opening of bankruptcy proceedings in March 2022, the company’s debt to over 300 creditors exceeded 27 million rubles and 58 thousand euros. Vysoki Zamok ALC managed to pay off former employees during the month of the protection period, but the amount of its debts still exceeds its assets.
In April, the protective period, previously introduced at the enterprise, was extended by the court decision.
The Minsk Central District Department of the Ministry of Taxes and Duties of the Republic of Belarus had claims against one of the oldest tour operators in the country this year. The reason was Merlintur LLC’s debt to the budget in the amount of more than 1.3 million rubles, revealed following the results of the inspection of the FID of the State Control Committee of Belarus conducted in 2021.
“The debtor does not have any property and funds, it is not located at the legal address,” the company’s court file reads. The appointed emergency manager was ordered to submit a plan for the liquidation of the debtor by mid-June.
Merlintur LLC has been working in the market of tourist services of the republic since 1995. Its owner is Barys Ulasau. His mother, Lilia Ulasava, is the founder and owner of one of the country’s first private law firms. In August 2020, she entered the praesidium of the Coordinating Council for the Transfer of Power, and was detained and released in October of the same year.
One of the significant events in the domestic retail market in 2021 was the withdrawal of the pioneer of the country’s malls owner – the Bigzz chain.
Barys Lukomski, one of the Baniar’s top managers started a liquidation process in the spring of last year. However, the company did not have enough funds to pay off suppliers and other creditors. In the spring of this year, at the request of a major alcohol producer and distributor of BVgroup JLLC, a bankruptcy proceeding was opened in the framework of the retailer’s bankruptcy case. The Mahiliou Leninski District Department of the Ministry of Taxes and Duties of the Republic of Belarus demanded the same at the same time, as well as AlfaBank.
The published documents foreshadow the scope of the upcoming litigation: as of February this year only, the undisclosed amount of Baniar’s liabilities (including wages) amounted to almost 22.4 million rubles and more than 1.5 million dollars. Its assets were valued by the liquidator at 13.6 million rubles.
In 2020, businessman Aliaksei Kavalenak and his partners launched the first stage of one of the main 2010s investment projects – the Miory tinplate plant. MMPZ-Group LLC entered the market and gained great fame by signing a sponsorship contract with McLaren, one of the leading Formula 1 racing teams, in the same year.
Aliaksandr Lukashenka was supposed to come to the enterprise In the summer of 2021. However, the security services raided and detained the leadership of MMPZ-Group LLC on the eve of his visit to Miory. Since then, the plant, which employed about 20% of the city’s workers, has had constant problems: production had been stopped at the plant, and according
to the results of 2021, the enterprise suffered a net loss of 91.1 million rubles.
Belarusbank also added to these problems with its court appeal, being the main creditor, which caused the initiation of bankruptcy proceedings. The plant owes the bank more than 250 million euros and has already overdue payments in excess of 28 million euros.
This year, the liquidation of the once largest Belarusian restaurant food delivery service has begun. The holding company Menubay LLC has not been operating since the end of last year and has filed for bankruptcy.
According to court files, its debts amounted to $840,000 in May, with assets of just over $50,000. Also, the Belarusian legal entity must repay the parent company Menu Group (UK) a loan in the amount of $1.8 million.
The court hearing in the Menu.by case is scheduled for August this year.