MOSCOW, October 5 - RAPSI. After a year of litigation, the Eurocement Group and Basic Element have finally agreed to settle their $5.46 million debt, the Kommersant newspaper reported Friday.
Basic Element must pay the debt for under-supplied commodities by 2013. The debt will be paid in funds and raw materials. The conflict could result in a production complex's closure in Pikalyovo in the Leningrad Oblast.
The complex belongs to three owners - BaselCement-Pikalyovo, the Fosagro chemical holding, and billionaire Filaret Galchev's Eurocement Group. All of these enterprises are connected by a single production cycle. Last year, Eurocement sued BaselCement-Pikalyovo, demanding compensation for under-supplied slime and limestone, and lost profits amounting to 169.2 million rubles ($5.46 million).
Eurocement won two cases amounting to 50 million rubles ($1.61 million) and 111.2 million rubles ($3.59 million) in three instances. The consideration of BaselCement-Pikalyovo's appeal against the ruling to recover 8 million rubles ($259,000) was set for October 17, but an application on concluding an amicable agreement under the ruling was registered in early September.
BaselCement General Director Vyacheslav Shmatov told Kommersant yesterday that the parties have agreed on terms to restructure the debt and the conflict has been resolved. He added that Basic Element, which is owned by oligarch Oleg Deripaska, will settle all outstanding issues with the Eurocement Group by late 2013. The group confirmed that they have reached agreements in the 8 million ruble ($258,500) and 111.2 million ruble ($3.59 million) lawsuits.
"Negotiations in the third dispute are under way," the company's representative said, while refusing to provide further comments. Earlier, Basic Element top managers warned that the demand to pay the entire amount to Eurocement could jeopardize the plants existence, and production could cease.
The EuroCement Group is an international, vertically integrated industrial holding that manufactures construction materials. It is one of the eighth largest cement manufacturers in the world.