ARMA can and should revise the terms of the tender for the manager of the Gulliver shopping center - lawyer

The Asset Recovery and Management Agency, after starting negotiations with the state-owned Oschadbank, should cancel the tender for the selection of a manager for the Gulliver shopping center and announce a new one, taking into account the interests of state-owned creditor banks. This opinion was expressed in an exclusive commentary to UNN by former adviser to the SBI director, lawyer Oleh Shram.

Details

Even after the tender for the selection of a manager for the Gulliver shopping center was announced, representatives of the Asset Recovery and Management Agency decided to meet with Arsen Miliutin, the deputy chairman of the board of Oschadbank in charge of NPLs, to discuss  the management of the seized asset, which affects the interests of the state-owned bank in terms of repayment of loan debts. As expected, the meeting failed to reach a consensus, and the parties agreed to “continue cooperation.” Miliutin reportedthat at the meeting, the ARMA promised to once again “study in detail” the relevant regulations for the possibility of including payments to creditor banks in management expenses. However, it is worth noting that ARMA's rhetoric has not changed dramatically since this meeting - they continue to justify that the current legislation does not allow the agency to become a creditor or debtor in the obligations of the asset owner.

Lawyer Oleg Shram believes that the ARMA can and has every right to cancel the current tender for the manager of the Gulliver shopping center, especially given the start of negotiations with Oschadbank.

“If the property is encumbered by loans, then all circumstances must be taken into account when deciding on the transfer to management. These are quite significant and important circumstances, and ARMA should have taken them into account earlier, and it is not clear why they did not. This had to be done so that the receiver could resolve issues, including loan repayment. This is essential,” Shram said.

According to him, if the Gulliver building is transferred to a manager without the obligation to service the loans, state-owned banks will not receive funds.

A way out of this situation may be to cancel the current tender and announce a new one, taking into account all the circumstances, to ensure a transparent mechanism for servicing loan obligations.

Context

On October 30, ARMA announced a competition to select a manager for the Gulliver shopping center. The head of the agency, Olena Duma, proudly stated that she had taken the strictest possible approach to the selection of a manager for this high-profile asset and even set the maximum possible 4 criteria for candidates. However, among the criteria set out by ARMA, there is no mention of the need to pay off the mortgage loan. 

Oshchadbank has repeatedly stated that the decision to transfer Gulliver to ARMA harms the interests of the state-owned bank, as it will deprive it of loan payments from the company that owns the capital's complex . Oschadbank's losses due to the termination of loan payments could reach more than UAH 20 billion.

After the announcement of the tender, Arsen Miliutin, deputy chairman of the board of Oschadbank in charge of NPLs, said in a commentary to UNN that the state-owned bank plans to recover the building of the capital's Gulliver shopping center in its favor if ARMA transfers it to management. He expressed indignation that instead of paying the loan to state banks, Gulliver's earnings would be given to an “incomprehensible manager”.

Only after that, and under public pressure, did ARMA representatives decide to negotiate with Oschadbank.