Arco Vara AS and SIA Arco Real Estate (hereinafter “Company”) management jointly announce management buyout (hereinafter “MBO”) of the Company.
On 31 October, 2016, Arco Real Estate AS, which is Arco Vara AS 100% subsidiary, sold its 70% stake in SIA Arco Real Estate to its current shareholder and chairman of the management board. After acquisition is complete Mr. Aigars Smits will become the major and controlling shareholder of the Company.
The Company has no significant influence on the financial results of Arco Vara group. As the major shareholder without the decisive influence over the Company, Arco Vara group decided to sell its shares in the Company to Mr. Aigars Smits.
The Company will continue its services as usually according to its best practices under rebranded new name. No changes will be made in the current management of the Company as well as in the Company’s structure. All current contracts shall remain valid and binding towards any third person.
According to MBO contract the Company management shall complete the Company rebranding within 180 days from the acquisition.
Arco Vara AS' CEO Tarmo Sild’s comment:
„During the last five years, SIA Arco Real Estate generated on average 5% of the Group’s revenue, but no profit for the Group’s shareholders. While we recognized the complicated situation on Latvian real estate market after the crisis and today, the parent company’s views on conducting brokerage and valuation business did not match the views of our Latvian management and 30% shareholders. Therefore, we agreed on a logical and mutually respectful solution whereby the management bought from the Group the existing organization and office. Arco Vara Group will continue doing real estate business in Latvia under its brand name Arco Real Estate and is open to new ventures, while we wish the best to our former partners and new competitors“.
SIA Arco Real Estate Chairman Mr. Aigars Smits’ comment:
”SIA Arco Real Estate has been in the market for almost twenty years. The company has gained its reputation as a reliable, professional and trustable company. Major part of our employees has been in the company for more than a decade and key persons since company was founded in year 1997.The company provides services mostly for the local market, therefore MBO is a logical solution for the company’s future”.