The National Bank of Ukraine (the NBU) is concerned about the sale of property of the Geneva health resort owned by Truskavetsinvest LLC (the Company). In 2013, the Company pledged the resort and the land plot as collateral to Eurogasbank JSC, and the bank transferred the title to this collateral to the NBU for a refinancing loan.
In 2018, the market value of the real estate belonging to Geneva resort was UAH 261.6 million (including: UAH 244.6 million – real estate value, and UAH 17 million – the value of land), according to the NBU’s internal assessment.
However, according to the NBU, the trustee in bankruptcy and liquidator of the resort V. Bondarenko did not perform such an assessment of the debtor`s property. Instead, at auctions scheduled for 28 December this year, he set the opening price of real estate of Truskavetsinvest LLC at UAH 223.1 million with the possibility to decrease the initial value of the property to the auction tick, which is UAH 2.2 million.
That is, as a result of the auction, the resort, which according to the NBU is worth UAH 261.6 million, may be sold for only UAH 2.2 million.
Note that to participate in the auction, the participant must pay a large guarantee fee of 10% of the initial value of the lot, which is UAH 22.3 million.
The NBU sees in the above sale of the Company’s property a risk of “artificial” auction to ensure the acquisition of assets by a predetermined winner. This conclusion was made based on the following aspects in particular:
- setting the opening price of property without assessing the property and its market value, as well as the size of the down payment, which makes it possible to narrow the circle of those willing to participate in the auction
- setting the the lowest possible price at UAH 2.2 million
- no approval of the sale of collateral from Eurogasbank JSC as the lender owing the collateral.
In addition, the trustee in bankruptcy has not taken any measures to preserve the property of Truskavetsinvest LLC: the Geneva resort continues to operate and carry on business. In particular, one can easily book a room at the hotel through contact phones, which are publicly available on the Internet. According to the law, the business of a bankrupt shall be terminated from the date of adoption by the Economic Court of the decision to recognize the debtor’s bankruptcy and the start of the liquidation procedure.
The NBU notes that, under Article 98 of the Law of Ukraine On Restoring Debtor’s Solvency or Recognizing the Debtor Bankrupt, the liquidator is obliged: to strictly comply with the legislation; take measures to protect the debtor`s property and prevent any possibility of a conflict of interest. The objective of an auction, as a means to sell the real estate, is, first of all, alienation of bankrupt’s property at the maximum price at the condition of transparency and free competition.
Taking into account the law requirements and the risks associated with the sale at the auction on 28 December of the assets held by the NBU as collateral without the permission of the bank and for the amount lower than its value, the NBU has filed a request to the Ministry of Justice to carry out an ad-hoc review of the legitimacyof the actions of the trustee in bankruptcy of Truskavetsinvest LLC, V. Bondarenko.