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What Has Become of GILD Arbitrage Fund's Purported 20 Million Euro Investment in Armenia's Mines?
Edik Baghdasaryan
http://hetq.am/en/society/gild-arbit rage-risk-capital-fund-2/
2009/09/28 | 18:15
Feature Stories society economy
In the 2008 yearly financial report issued by the Estonian GILD
Arbitrage Risk Capital Fund, the company says that it has invested
20 million Euros in Armenia. According to the report, the company
has invested in Armenia's mining sector via Melorama Holding Ltd.,
registered in Cyprus.
This firm has registered several subsidiary holdings in Armenia that
have also acquired mines and performed mining studies. The report
claims that it has spent 20 million Euros for such operations.
The question now before us is which specific mines has this off-shore
company purchased? We have yet been unable to answer this question. In
response to our inquiry, the government has declared that, "Melorama
Holding Ltd. does not appear in the list of those companies duly
registered as operating in the mining sector of the RoA." This
response can only mean that either the Armenian government is unaware
of the transactions taking place in the mining sector or that Melorama
Holding Ltd., for whatever reason, is conducting transactions through
a third party and that its name does not directly appear in the list
of shareholders.
Through the assistance of our colleague with the Estonian newspaper
"Äripaev", the shareholders of Melorama Holding Ltd. have been
uncovered:
1. 25% of the company belongs to "AS Gild Fund Management" registered
in Estonia.
2. 60% belongs to "Melorama Investments Ltd¦. This company is
registered in the Marshall Islands; another off-shore zone.
3. 15% belongs to Davit Manukyan, whose address is registered at
Yerevan, Aghbyur Serob Street 11/3, Apt. 2
No one lives at this address. Numerous phone calls went unanswered. The
apartment belongs to RoA Presidential Advisor Andranik Manukyan or
his son, Davit Manukyan.
We tried to get Andranik Manukyan's comments on the matter but to no
avail. His assistant repeated that he was away on a business trip
and unavailable. We had informed them previously as to the nature
of our inquiry. The assistant gave us the same answer even when we
called a second time; this despite the fact that we had spotted
Andranik Manukyan at an event in downtown Yerevan that very same
day. Evidently the presidential advisor seeks to avoid comment on
the matter. Mr. Manukyan had dealings with Armenia's mines back when
he was a minister in the government. It was through his meditation
that the Hankavan gold mine was sold to the Russian-based company,
GeoProMining. According to our information, the cost of the sale was
U.S. $30 million.
An Estonian journalist severely questions whether such investments have
actually been made. It cannot be ruled out but it is more likely that
in 2008 a few Armenian gold mines were sold to this off-shore company.
This would signify that the RoA government has seen not one penny as a
result of this transaction. It can also be assumed that the transaction
took place outside of Armenia and that none of the proceeds reverted
to Armenia.
Which mines have been purchased and who owns the exploratory and
operational licenses for them? Who were those government officials
that gave the go-ahead for the sale? One thing is crystal clear
however. Not just anyone could have obtained the exploratory and
operational licenses for the mines and then sold them without paying
any tax to the government.
The article appearing in the Estonian newspaper "Äripaev" cited
the quote of the Armenian government published in "Hetq" that
Melorama Holding Ltd. Isn't registered in any lists of mining sector
shareholders.
Subsequently, the newspaper presented the following explanation given
by Tõnno Vahk, Director of GILD Arbitrage Risk Capital Fund:
We can't comment from whom and on what conditions we bought those
assets (licenses) in Armenia, because there are strict confidentiality
agreements. Also, this could significantly damage ongoing negotiations
with potential investors. We have no need to share details of
our investments with public; this information is available for
investors. This kind of information (I asked the names of companies
GILD has in Armenia) is not important for public and publishing it
could only harm investors.
Melorama is a big group (altogether about 30 firms) and holding
company (Melorama Holding Ltd) does not directly own any Armenian
companies. According to the law only Armenian companies can own
licenses. This explains why there are now direct investments from
Cyprus to Armenian mining sphere.
We have nothing to do with Armenian former environment minister
(Vardan Ayvazyan), we invested, when he was vacated from his position.
Facts and information you got from Armenian government and journalist
are probably correct, but irrelevant and it has absolutely no meaning
from our position.
As one can see, the director of Gild Arbitrage claims that "Direct
investments in Armenia's mining sector are made via Cyprus". According
to the RoA National Statistics Service, Cypriot direct investment in
Armenia during 2008 amounted to $10 million. However, this amount has
no connection to the investments made in the mining sector. Before
the mining sector was passed to the jurisdiction of the Ministry of
Energy end Natural Resourcez , Environment Minister Aram Harutyunyan
allocated several score of exploratory licenses. Most of the mines,
essentially gold mines, were granted to the firm "Luliar Ltd."
This firm belongs to Silva Hambardzumyan who also owns "G. Arshakyan
Ltd", another company that was granted exploratory licenses for a
number of other gold and copper mines. Furthermore, two months ago
Silva Hambardzumyan also purchased the company "Sipan 1", which owns
the operating licenses for the Meghri-Lijkvaz-Tey and Terterasar
gold mines. The question arises - is there any connection between
the Estonian investments and the mines owned by Sylva Hambardzumyan?
Edik Baghdasaryan
http://hetq.am/en/society/gild-arbit rage-risk-capital-fund-2/
2009/09/28 | 18:15
Feature Stories society economy
In the 2008 yearly financial report issued by the Estonian GILD
Arbitrage Risk Capital Fund, the company says that it has invested
20 million Euros in Armenia. According to the report, the company
has invested in Armenia's mining sector via Melorama Holding Ltd.,
registered in Cyprus.
This firm has registered several subsidiary holdings in Armenia that
have also acquired mines and performed mining studies. The report
claims that it has spent 20 million Euros for such operations.
The question now before us is which specific mines has this off-shore
company purchased? We have yet been unable to answer this question. In
response to our inquiry, the government has declared that, "Melorama
Holding Ltd. does not appear in the list of those companies duly
registered as operating in the mining sector of the RoA." This
response can only mean that either the Armenian government is unaware
of the transactions taking place in the mining sector or that Melorama
Holding Ltd., for whatever reason, is conducting transactions through
a third party and that its name does not directly appear in the list
of shareholders.
Through the assistance of our colleague with the Estonian newspaper
"Äripaev", the shareholders of Melorama Holding Ltd. have been
uncovered:
1. 25% of the company belongs to "AS Gild Fund Management" registered
in Estonia.
2. 60% belongs to "Melorama Investments Ltd¦. This company is
registered in the Marshall Islands; another off-shore zone.
3. 15% belongs to Davit Manukyan, whose address is registered at
Yerevan, Aghbyur Serob Street 11/3, Apt. 2
No one lives at this address. Numerous phone calls went unanswered. The
apartment belongs to RoA Presidential Advisor Andranik Manukyan or
his son, Davit Manukyan.
We tried to get Andranik Manukyan's comments on the matter but to no
avail. His assistant repeated that he was away on a business trip
and unavailable. We had informed them previously as to the nature
of our inquiry. The assistant gave us the same answer even when we
called a second time; this despite the fact that we had spotted
Andranik Manukyan at an event in downtown Yerevan that very same
day. Evidently the presidential advisor seeks to avoid comment on
the matter. Mr. Manukyan had dealings with Armenia's mines back when
he was a minister in the government. It was through his meditation
that the Hankavan gold mine was sold to the Russian-based company,
GeoProMining. According to our information, the cost of the sale was
U.S. $30 million.
An Estonian journalist severely questions whether such investments have
actually been made. It cannot be ruled out but it is more likely that
in 2008 a few Armenian gold mines were sold to this off-shore company.
This would signify that the RoA government has seen not one penny as a
result of this transaction. It can also be assumed that the transaction
took place outside of Armenia and that none of the proceeds reverted
to Armenia.
Which mines have been purchased and who owns the exploratory and
operational licenses for them? Who were those government officials
that gave the go-ahead for the sale? One thing is crystal clear
however. Not just anyone could have obtained the exploratory and
operational licenses for the mines and then sold them without paying
any tax to the government.
The article appearing in the Estonian newspaper "Äripaev" cited
the quote of the Armenian government published in "Hetq" that
Melorama Holding Ltd. Isn't registered in any lists of mining sector
shareholders.
Subsequently, the newspaper presented the following explanation given
by Tõnno Vahk, Director of GILD Arbitrage Risk Capital Fund:
We can't comment from whom and on what conditions we bought those
assets (licenses) in Armenia, because there are strict confidentiality
agreements. Also, this could significantly damage ongoing negotiations
with potential investors. We have no need to share details of
our investments with public; this information is available for
investors. This kind of information (I asked the names of companies
GILD has in Armenia) is not important for public and publishing it
could only harm investors.
Melorama is a big group (altogether about 30 firms) and holding
company (Melorama Holding Ltd) does not directly own any Armenian
companies. According to the law only Armenian companies can own
licenses. This explains why there are now direct investments from
Cyprus to Armenian mining sphere.
We have nothing to do with Armenian former environment minister
(Vardan Ayvazyan), we invested, when he was vacated from his position.
Facts and information you got from Armenian government and journalist
are probably correct, but irrelevant and it has absolutely no meaning
from our position.
As one can see, the director of Gild Arbitrage claims that "Direct
investments in Armenia's mining sector are made via Cyprus". According
to the RoA National Statistics Service, Cypriot direct investment in
Armenia during 2008 amounted to $10 million. However, this amount has
no connection to the investments made in the mining sector. Before
the mining sector was passed to the jurisdiction of the Ministry of
Energy end Natural Resourcez , Environment Minister Aram Harutyunyan
allocated several score of exploratory licenses. Most of the mines,
essentially gold mines, were granted to the firm "Luliar Ltd."
This firm belongs to Silva Hambardzumyan who also owns "G. Arshakyan
Ltd", another company that was granted exploratory licenses for a
number of other gold and copper mines. Furthermore, two months ago
Silva Hambardzumyan also purchased the company "Sipan 1", which owns
the operating licenses for the Meghri-Lijkvaz-Tey and Terterasar
gold mines. The question arises - is there any connection between
the Estonian investments and the mines owned by Sylva Hambardzumyan?