Oil Production may be declared insolvent

Yesterday, the Voronezh Arbitration Court received a statement of self-bankruptcy of Oil Production CJSC, one of the largest creameries in the region and the main asset of the Masloproduct group of companies, whose main owner Alexey Bazhanov is now accused of embezzling government funds in the amount of 1.1 billion rubles. According to a number of Kommersant sources, bankruptcy is “a forced measure provoked by the simultaneous demand for payment of debts by a large number of creditors.” However, according to observers, bankruptcy may be part of a scheme to preserve the asset.

Alexey Bazhanov (center) may be missing his main asset
Photo: Gennady Gulyaev, Kommersant / buy photo

As a source familiar with the situation explained to Kommersant, the plant is not an unprofitable enterprise. “Last year, the plant kept its wage fund in second place after Bunge (another creamery in the Voronezh region - Kommersant), and now it continues to operate. However, after the high-profile stories with Alexei Bazhanov, suppliers of customer-supplied raw materials simultaneously began to demand theirs, creating an artificial rush,” the interlocutor told Kommersant. It was not possible to contact Alexey Bazhanov himself yesterday because he is in a pre-trial detention center. The central Voronezh office of Oil Production noted that they “did not know about bankruptcy,” and could not contact general director Nikolai Rodnishchev due to his absence from the site for several weeks. The regional government noted that they are closely monitoring the situation, helping to maintain the production process and work on tolling schemes: “Creditors understand that an enterprise sold in parts will lose value and will not be able to pay off its debts. There is now a supply of raw materials, wages have been paid by mid-May.” According to Kommersant sources, among the enterprise’s creditors there are at least five banks, the most significant amount was borrowed from Svyaz-Bank.

The reason for the “excitement” among Oil Production’s creditors was the fact that Alexey Bazhanov is considered a key participant and organizer of the fraudulent theft of 1.125 billion rubles allocated in 2008–2009 by Rosagroleasing to the structures of Masloproduct. According to investigators, the money was intended for the purchase of equipment for an oil extraction plant (OEP) in the Verkhnekhava district of the Voronezh region, but no equipment was purchased with Rosagroleasing’s money. However, the problems of Masloproduct Group of Companies became widely known last year, when one of the holding’s legal entities, United Grain Company CJSC (UZK), was declared insolvent. The bankruptcy was the result of an attempt by Rosselkhozbank to recover from the company more than 1 billion rubles allocated in 2009 for the modernization of the same oil extraction plant. At the same time, the previously parent legal entity of Alexey Bazhanov’s holding, CJSC Masloproduct, was transformed into OZK.

CJSC Oil Production, separated in 2011 from CJSC Masloproduct-Bio, also went through a reorganization and change of owners - now the official owner of Oil Production is the Cypriot Hedgecrystal Holdings Limited. Moreover, according to the Integrum company, two Oil Production CJSCs are registered in the Verkhnekhava district of the Voronezh region. At the end of last year, the companies initiated a reorganization procedure in the form of a merger, but the decision was canceled in March 2013. At the same time, it was CJSC Oil Production, registered in Verkhnyaya Hawa on Zheleznodorozhnaya Street, 120 (according to arbitration data, it is the one that is going bankrupt), that was assigned the main property complex of the group. According to Kommersant's information, as of April 1, the company employed 458 people, personal income tax was paid for 10 million rubles, and there were fixed assets. But the property tax debt was already 60 million rubles.

The head of the regional Federal Tax Service, Sergei Dukanov, told Kommersant yesterday that the service will have to participate in the bankruptcy procedure of Oil Production, since today the company already has property tax debts. “The authorized body will conduct a thorough analysis of the enterprise’s accounts payable, not limiting itself to checking the debt only to the budget,” Mr. Dukanov promised.

According to a market source who wished to remain anonymous, the total credit debt of the bankrupt enterprise is about 8 billion rubles. “At the same time, a new plant with imported equipment now costs about 2.5-3 billion rubles. Most likely, the bankers decided to put their owner in the plant, otherwise what is the point of bankrupting it? It’s better to take control of the work in order to repay the debts over time,” says Kommersant’s interlocutor. But, in his opinion, such a scheme is impossible without the consent of the owner of the enterprise. “If he was given an interesting offer and this is the plan, then a change of ownership will simply occur through bankruptcy. At the same time, the plant will continue to operate, and the accused Bazhanov may soon find himself at home,” the source suggested.

Managing partner of the Central District law firm, Dmitry Prosvirin, agrees that the application for self-bankruptcy is “a measure, apparently, forced and is associated with a significant volume of simultaneously presented claims, including early fulfillment of monetary obligations.” At the same time, Mr. Prosvirin emphasized that for creditors the prospects for real recovery in this procedure “remain illusory,” since it is unclear in which of the two Oil Production CJSCs the main assets of the enterprise are now concentrated.

Maria Starikova, Andrey Tsvetkov

Bankruptcy went like clockwork