Sergei Bakeshin commented for Novy Prospect the end of bankruptcy proceedings against “First Furniture Factory – Alno” LLC

Sergei Bakeshin - Counsel

On 17th of November 2021 bankruptcy proceedings against “First Furniture Factory – Alno” LLC were terminated. The Arbitration Court of St. Petersburg and the Leningrad Region established that there were no indications of intentional or fabricated bankruptcy of the company, and also confirmed that the bankruptcy manager had followed all the measures provided by bankruptcy law in relation to the debtor.

A joint venture “First Furniture Factory – Alno” LLC was established in 2015 by “First Furniture Factory” CJSC and Alno AG, a German concern, to implement a project for  modernization of a furniture factory. Alno AG had an estimated investment of €50 million (2.5 billion roubles), but in 2017 the company faced a financial crisis and was declared bankrupt. In 2018, Alno AG was excluded from the joint venture and the debts of “First Furniture Factory – Alno” LLC, which arose from the German concern’s failure to fulfil its investment obligations, were bought out by “Procept” company, which filed a lawsuit for debtor bankruptcy. At the stage of making the register of creditors Alno AG was included in it and tried to recover its contribution to the joint venture in the amount of 28.5 million roubles.

According to Sergei Bakeshin, Head of Dispute Resolution and Insolvency practice at Maxima Legal, the court ruling is beneficial for the First Furniture Factory. The expert told Novy Prospect that the ruling on the end of bankruptcy proceedings means the end of bankruptcy proceedings and termination of the bankruptcy manager’s activity. Creditors will not be able to make new claims and will not be able to challenge the debtor’s transactions. “An entry is made in the Unified State Register of Legal Entities about the liquidation of the debtor and its history ceases,” Sergei explained.

Sergei Bakeshin also pointed out that bankruptcy resulting from a quarrel between business partners is quite a common story. “However, foreign companies act as such business partners significantly rarer than Russian ones,” the expert noted.