The beverage producer AS Amber Latvijas balzams had submitted an application to the Riga City Court seeking the initiation of a legal protection (restructuring) process, the company said on January 30 in a disclosure to the Nasdaq Riga stock exchange.
The application has been filed in order to restructure the company’s financial obligations. The purpose of the legal protection process is to safeguard the company’s operations while working with creditors to establish a sustainable financial structure, the company explained.
Amber Latvijas balzams also stressed that it would continue normal business operations during the legal protection process.
The application applies only to the Latvian company and its warehouse operations. The group’s sales and distribution companies in other countries are not affected, and their activities will continue as usual.
According to the company, the decision to seek legal protection was taken following the divestment of Amber Beverage Group assets in Russia and a large-scale cyberattack that targeted both domestic and international operations. The decision was also influenced by challenges in global spirits markets.
The combined impact of these factors created significant cash-flow problems, leading to delays in the payment of excise tax. After prolonged discussions with the State Revenue Service (VID) regarding overdue excise tax liabilities, VID froze the company’s bank accounts. The legal protection process provides a structured framework for resolving all liabilities, including tax debts, through a court- and creditor-approved restructuring plan.
The company noted that all liabilities incurred up to January 30 would, in line with regulations, be frozen and addressed within the restructuring plan. Liabilities incurred from January 30 onwards will be settled in the normal course of business. Employee salaries will continue to be paid as usual during the legal protection process.
Amber Latvijas balzams said its objective is to reach agreement with creditors, including state institutions, on a restructuring plan, align a sustainable business model, and emerge from the process as a stronger company.
Management plans to complete the development and approval of the restructuring plan until mid-2026, with the aim of exiting the legal protection process in the second half of 2027.
The legal protection application does not affect the parent company, Amber Beverage Group. The group’s sales and distribution activities worldwide will continue as normal.
“This was a difficult but necessary decision to protect our company, brands, and jobs at Latvijas balzams. The legal protection process gives us the legal safeguards we need to reach agreements with creditors and build a sustainable path forward,” said Amber Beverage Group CEO Normunds Stanevics. (BNN)