June 19 (Bloomberg) -- An Estonian court acquitted Toomas Annus, the main owner of AS Merko Ehitus, and other defendants including two former ministers of bribery charges that forced the largest listed Baltic builder to split into two companies.
The Harju County Court ordered the government to repay the litigation costs of the seven individuals acquitted, AS Jarvevana, spun off from Merko in 2008, and AS E.L.L. Kinnisvara, totaling 1.3 million euros ($1.64 million), according to an e-mailed statement from the court today. The verdict can be appealed in 15 days in the court of second instance.
Surveillance proceedings during the investigation including phone taps and searches violated the legal norms, including the protection of the basic rights of individuals, Baltic News Service cited Judge Valeri Loonik as saying in court.
Merko in 2008 split into two companies to protect shareholders and employees after the Public Prosecutor’s Office started an investigation on suspicion that Annus, 51, and the company had bribed or offered bribes to government officials, including former ministers Villu Reiljan and Ester Tuiksoo, for property transactions involving Land Board.
Annus and Merko have denied any wrongdoing and said the proceedings have led to lost orders for the company. Jarvevana, spun off with 19 million euros in assets related to criminal proceedings, could face a fine of as much as 16 million euros if the verdict is appealed and the company is found guilty.
Jarvevana shares jumped as much as 25 percent to 51 euro cents today, the biggest gain since December. The stock has gained 46 percent in the past 12 months compared with a 37 percent drop for its industrial peers in Eastern Europe, according to data compiled by Bloomberg.
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