23 Oct 2017 19:11

Montenegrin aluminium plant files 45 mln euro lawsuit against En+

MOSCOW. Oct 23 (Interfax) - Aluminium Plant Podgorica (KAP), which belongs to a subsidiary of Oleg Deripaska's En+ Group, has filed a 45 million euro lawsuit at a Podgorica court, a prospectus for En+'s IPO said.

The defendant is the Central European Aluminum Company (CEAC) an En+ subsidiary and former majority shareholder in KAP. The Montenegrin company believes that CEAC damaged KAP due to improper management, resulting in the closure of the plant in 2009.

CEAC acquired a 65.4% stake in the Montenegro's largest company and delivered raw materials from a bauxite mine in 2005 for 48.5 million euros. Soon after this,

CEAC, according to En+, discovered the existence of previously unknown financial commitments in the company's accounting. In 2008, after a drop in global aluminium prices, En+ started talks with the Montenegrin government on possible state support measures for KAP with the goal of maintaining production at the plant. Energy tariffs were also discussed. In 2009, the group and the Montenegrin government reached an agreement on laying off over half the workforce at the plant and bauxite mine. In 2013, regardless of the agreement, KAP was declared bankrupt at the initiative of the Montenegrin government. Following this the plant was sold to a local company for 28 million euros.

En+ has had several legal battles with the Montenegrin government, the plant's administration during bankruptcy and other players. En+ announced that it was preparing lawsuits totaling 1 billion euros in 2013.