MOSCOW, September 3 - RAPSI. On Monday the Moscow Commercial Court postponed a hearing for the Foreign Economic Bank's (VEB) lawsuit against major development company Don-Stroy until November 6. VEB is seeking over $144 million in the suit, the court told the Russian Legal Information Agency (RAPSI/rapsinews.com).
At the previous hearing the court learned that the parties were negotiating a settlement. The developer also reported that it was changing its name to Assol. On Monday the parties said their negotiations were ongoing and thus filed a motion to postpone the hearing.
The plaintiff initially sought 4.68 billion rubles ($144 million), but on Monday a motion was filed to increase the amount due to mounting interest.
Don-Stroy's subsidiaries Soling and Complex-Stroy are acting as co-defendants.
In December 2007, Svyaz-Bank granted Soling a $115.5 million credit line with a five-year term at an annual interest rate of 10-percent. During the financial crisis, the rate was increased on two occasions and has reached 15 percent.
Don-Stroy and Complex-Stroy were the guarantors of the loan. The claims under the credit line were assigned to VEB in 2011. VEB and Don-Stroy have each contested the terms and claims of the credit line agreement several times.
Don-Stroy Invest is one of Moscow's largest developers. In partnership with VTB, the company implements large-scale projects. Its 2011 revenue was 10.40 billion rubles ($316.39 million) and it plans to increase this by 24 percent to 12.98 billion rubles ($394.7 million) in 2012.