Montenegrin police arrests aluminium firm KAP’s CFO on Serbian border

By bne IntelliNews July 11, 2013

Montenegro’s border police arrested the financial manager of aluminium firm KAP, Russian citizen Dmitry Potroubatch, late on Wednesday, July 10, over suspicions of wrongdoings in the company’s operations, TV and radio broadcaster RTCG reported.

Potroubatch was arrested at a border crossing with Serbia, close to the Montenegrin town of Bijelo Polje.

KAP entered bankruptcy on July 8 and the court has estimated its debts at EUR 386mn – twice above the firm’s nominal value. Members of KAP’s management and officials from state institutions have been complaining about the poor cooperation of Potroubatch when they tried to evaluate the real size of the company’s debts prior to the bankruptcy introduction. They also said he has disappeared.

According to media reports, Potroubatch was arrested upon an order of the country’s special prosecutor in charge of organised crimes, Djurdjina Nina Ivanovic, issued as part of the electricity theft investigation in KAP. The police have been searching for Potroubatch in the past ten days, trying to hold informative talks with him, but all his traces had been lost.

Potroubatch is accused of facilitating KAP’s theft of EUR 9.64mn of electricity from power grid operator CGES in the February 22-May 25 period. CGES actually took this amount of power without an authorization from the European transmission system for the needs of KAP. When the theft was discovered, the European transmission system operators demanded the return of the power and warned they might disconnect the whole country if it does not put in order its electricity system.

Potroubatch will be handed over to the prosecutors on Thursday, July 11. The reports claim the police is believing he was trying to flee to Serbia in order to escape the arrest.

KAP’s bankruptcy receiver Veselin Perisic said earlier this week KAP’s CFO had disappeared and nobody knew where he was. Media speculates he was hiding in the Russian embassy in Podgorica.

EN+ GROUP'S REACTION

Russia's En+ Group, which controls nearly 30% of KAP via its subsidiary CEAC, had reacted sharply at the news of Potroubatch's arrest, saying it will file a complaint against this decision of the Montenegrin judiciary, RTCG reported in a separate article. "The practice of the Montenegrin authorities to pointlessly accuse and pursue foreign investors is unacceptable and intolerable and represents nothing more than a repression of legitimate shareholders and investors," En+ has reportedly said.

The Russian company also said it has been continuously working towards turning KAP from a loss-making firm into a pillar of the Montenegrin economy and has cut the aluminium production costs from USD 3,500 in 2008 to USD 2,100 in 2012, seeking to provide undisturbed operations at the plant and keep the number of employees.

However, En+ Group reminded that it previously won a tender for the privatisation of thermal power plant TE Pljevlja and its adjacent mining firm Rudnik Uglja - but the tender was later on cancelled, leaving KAP without a secure power supply.  

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