The MDM financial group has sold on a USD 15.5 million debt owed by the Kaliningrad Region to the Cypriot company Duke Investments. This was announced today by the Russian Funds investment group, which is the financial consultant for the deal to sell on the loan given by Dresdner Bank to the Kaliningrad Region.
The group added that Duke Investments is an investment company and is not in any way connected to the MDM group. Russian Funds were unable to give any more details about the buyer. However, they added that Duke Investments now has the right to claim repayment of the loan. Lawyers representing the company have begun preparing documents for recovering the debt from the Kaliningrad regional administration. They plan to file suits in both Russian and foreign courts.
The USD 10-million loan was provided by Dresdner Bank in February 1998 to the Kaliningrad regional administration's regional development fund. During the credit period the administration paid some of the interest on the loan but then refused to fulfil any further obligations. The repayment deadline expired on February 12, 2003, with the total value of debt and interest standing at USD 15.5 million. At the end of February the debt was bought by the MDM group.
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