On February 7, 2023, the Nicosia District Court (Cyprus) issued an order preventing the creditor, Argentem Creek Partners (ACP), and its agent Madison Pacific Trust Ltd (Hong Kong), from taking action aimed at gaining possession, encumbering, or selling the grain terminal in Odesa Commercial Sea Port owned by the GNT Group and its rightful owners, Volodymyr Naumenko and Sergiy Groza.

Shareholders had to seek the order because of the quite aggressive actions taken by creditors against the GNT Group. Owners of the Group referred the matter to the court in Cyprus to limit the threats to the operation of the grain corridor caused by such actions.

According to the GNT Group’s earlier statements, the creditors are trying to devalue the business for the subsequent non-transparent resale of the company’s assets to an interested third party. Volodymyr Naumenko and Sergiy Groza, owners of the GNT Group, emphasized in their interview with Censor Business that they “...kept negotiating the debt restructuring in the first half of December not to lose the GNT Group’s working capital, as its loss would worsen its performance indicators...” However, by all appearances, the creditors started with the company’s hostile takeover in late December.

It became known on February 6 that the ACP initiated the bankruptcy of Olimpex Coupe International, the company that operates the grain terminal. Thus, the creditor decided to drive the grain terminal to bankruptcy during the war and amidst grain corridor operations to benefit from selling the company. The creditors do not care that agrarian producers would hardly entrust their grain to a company managed by a bankruptcy trustee, thus endangering the operation of the grain agreements. 

Fortunately for Ukraine’s key role in ensuring food security, the order of the Cyprus courts substantially limits the ACP’s opportunities to destroy Ukrainian businesses. Currently, the grain is shipped from Odesa Sea Port under the control of the GNT Group’s specialists without involving the ACP in this activity.

The GNP Group obtained a US$ 75 million loan from the Argentem Creek Partners in 2019 against the pledge of the company’s corporate rights, with the value exceeding the loan amount severalfold. The war against russia complicated the repayment of these loans. However, the commencement of the grain corridor operation gave rise to opportunities to settle the loans. The GNT Group has repeatedly stated its willingness to repay the debt in any civilized manner.

However, the creditor flatly refuses to negotiate with the GNT Group. Instead, the ACP initiated debt enforcement with elements of the company’s hostile takeover.

In December 2022, the GNT was only allowed two hours to meet the ACP’s demand to repay the loan. The creditor’s representatives used a power of attorney to immediately change the legal domiciles of the GNT Group’s managing companies from Odesa to Lviv. It makes no business sense to relocate during the war because the grain terminal cannot be moved to Lviv anyway. Also, a replacement of directors of the Ukrainian companies was initiated. It goes against the Corporate Agreement, under which a creditor’s representative is only permitted to appoint Commercial Directors with signing powers without replacing companies’ Directors.

The GNT emphasizes that the ACP started enforcing debt only after the terminal had become a valuable asset. About 1.5 million tonnes of agrarian products were handled at the GNT Group’s terminal over the six months of the operation of the grain corridor.

GNP Group is challenging ACP-initiated unlawful decisions by registrars and courts before courts of law to prevent the grain terminal’s operations from being blocked.

The GNT Group is a leading Ukrainian stevedoring company operating in Odesa Commercial Sea Port and an exporter of agricultural products. Transshipping grain and oilseeds and providing ancillary services (such as freight forwarding and ship agency services) have been the GNT Group’s core business, starting with establishing the Olimpex Coupe International company in 1993. The company operates based on its modern grain terminal and Dry Port site that accommodates a grain and oilseeds treatment facility. Olimpex Coupe International’s grain terminal ranks among Ukraine’s Top 10 grain terminals. Investments in its development exceeded $80 million.