Hrazdan cement plant undergoing second bankruptcy procedure 

ArmInfo. The situation at the Hrazdan Cement Plant is under the control of the Armenian government. This was stated by Deputy Minister of Economy of the Republic of Armenia Edgar Zakaryan from the rostrum of the National Assembly of the Republic of Armenia on May 27, answering a question from Arsen Torosyan, a member of the National Assembly from the ruling Civil Contract faction.

The deputy, in particular, pointed out that the enterprise is already under bankruptcy proceedings for the second time. Meanwhile, Torosyan continued, cement is a strategic raw material for the country, determining the scale of construction work. He asked the deputy minister what steps are being taken to save the Hrazdan Cement Plant.

In response, Zakaryan emphasized that several meetings and  consultations have been held on the above- mentioned issue. A "road map" is being developed with the owner of the plant to bring the enterprise out of the crisis, which is mainly due to the emergence of some financial problems. In this regard, Torosyan raised the issue of the possibility of state participation in the process of rehabilitating the plant by accepting part of the shares. "We cannot leave the process to chance. The state must participate in the management of large enterprises, including the Razdan Cement Plant, so as not to face serious challenges one day," the parliamentarian said.

In response, Zakaryan assured that this issue would also be raised during the discussions, and if necessary, the state would also become one of the plant's shareholders.

Continuing the topic, the NA member of parliament from the ruling faction Lilit Stepanyan noted that for more than a year, about 400 employees of the enterprise have not received their salaries. According to her, the management of the plant, citing existing debts, works intermittently, despite the availability of raw materials and finished products. Stepanyan accused the owners of inaction in operating the enterprise at full capacity.

In turn, the NA member of parliament from the opposition faction "Armenia" Artur Khachatryan noted that for a long time the plant has been in forced downtime, caused by the bankruptcy procedure

In this regard, the deputy minister once again assured that the issue is under discussion. He noted that a criminal case has been initiated on this issue, but refused to provide details, citing the lack of necessary information. "Nevertheless, the government is working to at least resolve the issue of employee salaries," said Edgar Zakaryan.

In Armenia there are two enterprises engaged in cement production - the Razdan and Ararat cement plants.  The Razdan Cement plant has gone through several stages of ownership changes. In 2001, it was privatized by Mikhail Baghdasarov, the president of MIKA Armenia, and  renamed Mika Cement CJSC. In 2016, due to accumulated debts, the enterprise was transferred to VTB Bank (Armenia), which became its full owner.  At the end of 2017, the plant was acquired by Razdan Cement Corporation, established by GM Holding, which, in turn, belongs to two entrepreneurs - Vitaly Grigoryants (55%) and Arsen Mikaelyan (45%).  Vitaly Grigoryants, a Russian-Ukrainian businessman  of Armenian origin, was previously the main shareholder of  Armbusinessbank CJSC, renamed AMIO BANK (95%). Arsen Mikaelyan is the Chairman of the Board of the same bank and the Director of the Vitaly Grigoryants Charitable Foundation. Thus, Razdan Cement Corporation, with an authorized capital of 80,010,000 drams, is part of a business group associated with financial and industrial assets controlled by Grigoryants and Mikaelyan. The court decision to initiate bankruptcy  proceedings for Razdan Cement Corporation LLC was made on May 4, 2022.