Shareholder of "Prodlacta" sues the Authority for State Assets Recovery

One of the shareholders of "Prodlacta", "Olimpus Dairy Industry", has sued the Authority for State Assets Recovery (AVAS), requesting that the latter be asked to sell 486,824 shares, which represent 27.13% of the increase of the company"s share capital by way of the plots of land contributed by the Romanian state, according to the shareholders" decision of October 2009.

Also, the shareholder requested that the court block the trading of the 1,794 million shares newly issued, until its complaint is solved.

In the beginning of October 2009, Prodlacta has increased its share capital by 2.245 million lei, from 14.451 million lei to 16.696 million lei. The amount represented the value of the plots of land for which the Company received the confirmation of ownership. As result, 1,650,294 shares with a face value of 1.36 lei were issued, of which belonged to the Romanian state, by way of the Romanian Authority for State Assets Recovery (AVAS) which is a shareholder in the company.

Braşov-based "Prodlacta" posted losses of 524,000 lei in Q1 2010, after posting a net profit of 366,000 lei in Q1 2009. The company"s turnover dropped 13% during the reporting period, from 16.6 million lei to 14.5 million lei.

The revenues of the company decreased 22% in the first quarter, from 15.3 million lei to 12 million lei, according to the quarterly report sent to the Bucharest Stock Exchange, whereas the expenses only decreased 16%, from 14.9 million lei to 12.5 million lei.

The Company"s Employee Association controls 41.75% of the company"s shares, Olympus Dairy Industry Baraolt, of the county of Covasna, which is part of dairy maker Tyras, holds 23.45%, and the Authority for State Assets Recovery holds 18.14%.