"Auga Group bondholders agree to sell Baltic Champs

The bondholders of „AWG investment 1“, a secondary management company of „Auga Group“, one of the largest organic food producers in the Baltic States, which is undergoing financial restructuring, have agreed to sell their pledged mushroom business „Baltic Champs“.  

The decision was made on 15 January, „Nasdaq“ Vilnius Stock Exchange reported on „Auga Group“.

In addition, it was decided to extend the maturity date of the bonds until 1 September.

In December, the company announced that „AWG investment 1“ had defaulted on its second bond issue of EUR 4.984 million, with a promise to redeem it after the sale of „Baltic Champs“.   

On 5 December, the company announced that it had signed a preliminary agreement for the sale of shares in „Baltic Champs“ to the Latvian-owned Mhitaryjans family company „Global Champs“. The majority of the proceeds from this transaction will be used for the redemption of the bonds and interest payments.

The company had planned to redeem the bonds on 10 November last year, but only paid the interest and postponed the maturity date to 5 December, but failed to do so then.

In August last year, the portal „Verslo žinios“ reported that „AWG Investment 1“ had borrowed €5 million from professional investors in a private placement, issuing bonds with a 14% interest rate. The underlying bonds were secured by a pledge of 100% of the capital of another group company, „Baltic Champs“. 

It was announced last January that the bondholders had decided not to call for early redemption of the bonds. Kęstutis Juščius, chairman of the board of directors of „Auga Group“, said at the time that the decision would allow the company to continue to operate in a timely and orderly manner in order to meet its obligations. 

As reported by BNS, following the approval of the company's restructuring plan by shareholders and creditors in August last year, the restructuring plan was approved by the Vilnius Regional Court on 2 September.

By the end of 2029, „Auga Group“ expects to have fully settled its financial obligations, reducing its debt from EUR 83.4 million to zero.