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The Agricultural Loan Fund - Announcement   22.7.2005 12:07:46
Flokkur: Skuldabréfafréttir      Íslenska  English
By Act No

By Act No. 68/2005, the Minister for Agriculture was empowered to sell all the assets of the Agricultural Loan Fund and negotiate the taking over of all its liabilities. The Executive Committee on Privatisation has been instructed to initiate preparations for the sale of the Fund’s loan portfolio and the taking over of its principal liabilities.

The sale is subject to the following conditions:

1.       The tenderer will take over all the liabilities of the Loan Fund, which in the majority of cases are guaranteed by the State.

2.       The tenderer must have a solid financial position and an international credit rating.

3.       The tenderer must be a financial undertaking in the meaning of Sub-sections 1-3 of Article 4 of Act No. 161/2002.

4.       The tenderer must accept the condition of honouring loan commitments already undertaken by the Board of Directors of the Fund subject to fulfilment of conditions.

5.       The tenderer must declare, by the submission of an offer to purchase the bonds in question, that the interest on the bonds will not be raised, nor their terms altered to the disadvantage of debtors, beyond the scope agreed by the Board of Directors of the Agricultural Loan Fund on taking over the loans.

6.       The tenderer must warrant that the provisions of the bonds concerning the debtor’s option to prepay will be maintained.

7.       The tenderer must declare his intention to endeavour to provide financial services to the agricultural sector on a commercial basis.

8.       The tenderer must declare his intention to endeavour to ensure that the employees of the Loan Fund retain their jobs or receive comparable jobs with the tenderer.

According to the audited annual financial report of the Fund for the year 2004, deposits (borrowings) of the Fund as at 31 December 2004 amounted to approximately ISK 15.2 billion, while lending in the form of bonds amounted to approximately ISK 15.6 billion. Furthermore, cash and claims on lending undertakings amounted to ISK 2.9 billion.

Parties interested in participating in the pre-selection process for a tender for the purchase of the loan portfolio of the Fund and taking over of its liabilities should notify the Executive Committee on Privatisation. Only parties meeting the conditions of Sections 1-8 above will be eligible for the pre-selection process. Notices from interested parties should be submitted before 4 p.m. on Friday, 5 August 2005, addressed to:

The Executive Committee on Privatisation,

Ministry of Finance, Arnarhváli

150 Reykjavík

Att. Stefán Jón Friðriksson / Jörundur Valtýsson


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