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Government To Annul Another Sale Of Yerevan Arena


Armenia - The Karen Demirchian Sport and Cultural Complex, Yerevan, 24April2005

Armenia - The Karen Demirchian Sport and Cultural Complex, Yerevan, 24April2005

The government is poised to annul a second privatization of Armenia’s largest sports and concert arena just five months after approving its $30 million sale to an obscure private company.

The Yerevan arena commonly known as Hamalir (Complex) was built in 1983, becoming one of the most modern Soviet facilities of its kind. It was subsequently named after Karen Demirchian, a late Soviet Armenian leader who was instrumental in its expensive construction.

The complex consisting of two large concert halls was sold in 2005 to the Moscow-based construction firm BAMO belonging to an Armenian-born businessman. The company paid $5.5 million and pledged to spend over $40 million on its renovation.

The government renationalized Hamalir in 2014, citing BAMO’s failure to repay a $25 million government loan. The company rejected the decision as illegal, taking the government to court.

In August 2015, Prime Minister Hovik Abrahamian’s cabinet decided to sell Hamalir as well as about 10 hectares of adjacent land to a newly established private firm for $30 million. It said the Armenian-registered company, NTAA Investment Group, will also invest over $100 million in expanding the facility and turning it into a big entertainment center.

The official agenda of the next cabinet meeting scheduled for Thursday includes a proposal to invalidate the August deal because of NTAA’s failure to pay the agreed sum. The motion will almost certainly be approved by ministers.

The scrapping of the deal will only raise more questions about the government’s handling of the property currently managed by the Armenian Defense Ministry. Critics already pointed out in August that very little is known about NTAA and its real owners and that the government decided to again sell Hamalir without a tender.

Artak Manukian, an economist, said on Wednesday that NTAA was never serious about honoring its large-scale investments commitments. Nor did the company present any details of its promised investments in Hamalir, he said.

“This only proves that the government didn’t take a serious approach and follow a proper legal procedure for negotiating such a deal,” Manukian told RFE/RL’s Armenian service (Azatutyn.am).

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