Harju County Court has declared bankruptcy of subsidiary of AS Pro Kapital Grupp - AS Tallinna Moekombinaat - and appointed Kristo Teder and Indrek Lepsoo as bankruptcy trustees. The first general meeting of the creditors will be convened on 17 June 2021.
AS Pro Kapital Grupp has previously announced that upon the declaration of bankruptcy, control over the subsidiary will be lost and the group will discontinue consolidation of financial indicators of the subsidiary. In the interim report for the first quarter of 2021, which was published on 31 May, the Company announced that AS Pro Kapital Eesti has written off an investment into subsidiary in amount of 13 million euros due to negative equity of TMK and as a result of adjusting event also receivables in the total amount of 26 million euros as at 31 December 2020. Discontinuing consolidation has an influence to the consolidated financial statements in amount of 26 million euros related to written-off receivables. As of 30 April, the subsidiary's equity was negative in amount of 56 million euros. Derecognition of the subsidiary's negative equity has a positive effect to the consolidated financial statements. Considering the minority interest portion, the estimated total impact on the Company's consolidated financial statements at the end of April was an increase of 26 million euros in equity of the group. Exact impact will become clear when the subsidiary's financial reports of May and June are completed as the Company continues consolidation until 2 June 2021.
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