2013-06-06
The Bank of Lithuania has imposed large fines on shareholders of Linas LLC for legal violations
The Bank of Lithuania imposed fines for two parties acting in concert for the infringement of the Law on Securities. The limited liability company (LLC) Rentija was fined LTL 250,000 and Mr. Ramūnas Lenčiauskas — LTL 300,000. The Board of the Bank of Lithuania also obliged these parties acting in concert to announce a mandatory takeover bid to buy up the remaining shares, granting the voting rights of the listed limited liability company Linas.
The Supervision Service of the Bank of Lithuania in their investigation ascertained that Rentija LLC and Mr. Ramūnas Lenčiauskas are shareholders acting in concert. It was stated that long lasting business relations, as well as high value contractual obligations, bind these persons. It was concluded that on 8 May 2012 Rentija LLC obtained 1,923,120 shares of Linas LLC. At this date, Rentija LLC and Mr. Ramūnas Lenčiauskas, acting in concert, obtained 42.57 per cent of all voting rights and crossed the limit settled in Article 31 of the Law on Securities. For this reason they obtained the duty to announce a mandatory takeover bid to buy up the remaining shares granting voting rights to Linas LLC. Rentija LLC and Mr. Ramūnas Lenčiauskas had not announced a mandatory takeover bid and thus infringed Article 31 of the Law on Securities.
The Board of the Bank of Lithuania considered this a violation of the minority shareholders rights and that the infringement has lasted since 8 May 2012. It was stated that parties acting in concert were seeking to avoid expenses related to the obligation to announce a mandatory takeover bid. It is not the first time when Mr. R. Lenčiauskas has infringed Article 31 of the Law of Securities — enforcement of the corresponding law court decision is still pending.
Taking into account that obligation to announce a mandatory takeover bid occurred on 8 May 2012, only persons who were shareholders of Linas LLC at that date will have the right to respond. Mr. R. Lenčiauskas and Rentija LLC have joint liability to fulfill the obligation to announce a mandatory takeover bid.
From 8 May 2012 it is held that Rentija LLC and Mr. R. Lenčiauskas lose all the votes given to them at the general meeting of shareholders of Linas LLC. For this reason, all the further decisions of the general meeting of the Linas LLC may be contested at a court of law.