In June 2014 BCR had issued an irrevocable bank guarantee in favor to BCR

Chisinau in order to ensure the loss exposure due to one of its clients, Magt Vest
LLC, according to next issues:
1)Bank guarantee value -1.965.898 euro(..)
2)Maturity -24.03.2015
Magt-Vest LLC represents the biggest loss exposure for BCR Chisinau JSC and its
case is classifies as underperformed (>450 days).
In order to avoid the violation of National Bank regulation at the maturity of bank
guarantee, BCR Chisinau JSC can appeal to 2 possibilities:
1) Either to ask for execution of bank guarantee by BCR.
2) Or to lengthen the maturity till 30.09.2015.
Current situation of the debtor:
Sugar industry of R.M.:
In 2014 Magt Vest LLC produced 15 th. Tons of sugar (by 2 Th. tones less in
comparison with previous year), even if in 2014 the sugar production in R.M. broke a
new record (155 Th. tones).On account of bad financial situation, Magt Vest LLC
had produced only 30% of its capacity (Donduseni and Glodeni factories).
Share of sugar production in R.M. in 2014:
1) Sudzucker Moldova JSC -67.8 %( 105 Th. tones)
2) Moldova Zahar LLC -22.5 %( 35 th. Tones)
3) Magt Vest LLC -9.7% (15 th. Tones)
Sugar industry has recorded losses in 2014 mainly by losing Russian Federation
market because of high customs duties (340$/tones), which increased the supply of
sugar and decreased the price.
Financial status of the debtor:
In 2012, the debtor has started a project in order to diminish its expenses, by
increasing the energetically efficiency of its production boiler, switching from
natural gas to coal. The cost of the project was estimated to be 5.2 mln euros. At
the moment in this project has been invested around 3.7 mln euro ,as a financing
source being used short term revenues, despite the fact that payback period is 7
years(at the moment boiler is not working).
The indeptness rate of the debtor exceeds 90%, main creditors are:

1) Commercial banks (40%of debts)

2) Energy suppliers (20%of debts)
3) Young plants and fertilizers suppliers (20%of debts)
4) Others (20 %of debts)
The decrement of production (in 2014 only Glodeni factory was functional) led to
financial problems of the company. Currently in order to pass over created situation
it is necessary to cover the existing financing gap, by capital allocation.
So the company is dealing with several Georgian investors who desire to invest in
the company until the mid of April, 10mln$, otherwise Magt Vest LLC wont be
able to sustain its operational activity in autumn.
Taking into consideration that:
1) All the companys efforts to honor its obligations.
2) Customers profile, 9 mln paid during December 2013- February 2015(last
payment 700 Th. Lei in January 2015).
3) Execution of bank guarantee will diminish companys attractiveness.
4) No documents regarding the existing negotiation with Georgian investors has
been provided.
BCR Chisinau JSC is asking for the prolongation for 6 month of bank
guarantee till 30.09.2015.
In September 2015, will be revalued the companys financial situation and
possibilities to apply for a credit restructuring. In case no investments happen BCR
Chisinau JSC will institute proceedings against Magt Vest LLC, in order to recover
its debts.