EuroAsphalt CJSC, a company previously linked to Armenian National Assembly Speaker Alen Simonyan’s brother, Karlen Simonyan, has declared bankruptcy despite securing an astonishing 133.8 billion AMD ($343 million) in government contracts over the past several years. The sudden financial collapse of such a lucrative business has raised serious concerns about transparency, insider influence, and corruption in Armenia’s state procurement system.
Massive Contracts and Questionable Bidding Practices
Between 2021 and 2024, EuroAsphalt won numerous state contracts, primarily for road construction projects. In 2021 alone, the company secured a 368 million AMD ($750,000) contract to renovate the Horom-Artik-Alagyaz highway and another 287.5 million AMD ($585,000) deal for road repairs in Aparan. By 2023, it was awarded an additional 79 million AMD ($160,000) contract for the Ayntap-Mkhchyan-Artashat-Aygevan highway—without a competitive tender.
However, reports indicate that EuroAsphalt’s success in securing these contracts was due, in part, to suspiciously low bidding margins. In at least one case, the company won a contract valued at about 400 million AMD ($830,000) by underbidding its closest competitor by a mere 50,000 AMD ($103), raising concerns that it may have had insider knowledge of rival bids.
Additionally, an investigation by Azatutyun (Radio Liberty) in 2021 revealed that the registered addresses for the company’s ownership led to a Yerevan apartment where the Simonyan family’s mother resided, as well as a home in a rural village belonging to an elderly woman unrelated to any construction business. These findings deepened suspicions about the true ownership of EuroAsphalt and its ties to politically connected individuals.
EuroAsphalt CJSC, a company previously linked to Armenian National Assembly Speaker Alen Simonyan’s brother, Karlen Simonyan, has declared bankruptcy despite securing 133.8 billion AMD ($343 million) in government contracts. Its sudden collapse has raised concerns about… pic.twitter.com/noONLEgZn4
— 301🇦🇲 (@301arm) March 4, 2025
Bankruptcy Filing and Financial Troubles
Despite securing contracts amounting to nearly 6% of Armenia’s annual national budget, EuroAsphalt was declared insolvent in January 2025. “At Company” LLC filed a bankruptcy claim against EuroAsphalt CJSC on January 24, requesting the court to recognize its financial collapse. The case, assigned to Judge Inga Barseghyan, highlights serious financial distress for a company that was once a dominant force in government-funded infrastructure projects.
Legal troubles had been mounting for EuroAsphalt even before the bankruptcy filing. Numerous lawsuits were filed against the company by banks, insurance firms, and various businesses, including Arins Capital, Rogo Insurance, Argishti 2, Vikan, Betongarz, and Sevak Boyajyan.
Leadership Changes and Political Connections
Karlen Simonyan served as EuroAsphalt’s director from March 2021 until 2023 when he was dismissed amid increasing scrutiny. His departure came as the company’s financial troubles escalated. He was replaced by Lilia Hovhannisyan, while the company’s official owners—Svetlana Poghosyan and Lusik Gevorgyan—remained unchanged. Simonyan had also been linked to another firm, TS Construction LLC, where he was listed as deputy director.
Pedro Zarokyan, a Yerevan City Council member from the “National Progress” faction, has been vocal in exposing EuroAsphalt’s suspicious activities. He pointed out that Alen Simonyan himself has denied any connection to the company’s ownership, yet has failed to clarify who the real owners are.
“If Civil Contract is truly committed to eradicating corruption, this is the number one place they should be investigating,” Zarokyan stated. “Law enforcement agencies must look into who actually owns EuroAsphalt and how they managed to win such massive contracts under questionable circumstances.”
A Larger Pattern of Corruption?
The collapse of EuroAsphalt raises broader concerns about how state funds are allocated and whether political favoritism is at play in Armenia’s procurement process. The company’s ability to secure multimillion-dollar government projects, despite its opaque ownership structure and eventual bankruptcy, points to a system in need of greater transparency and oversight.
With the case now in bankruptcy court, further developments are expected as investigators and legal authorities examine EuroAsphalt’s financial dealings and political ties. Whether this leads to real accountability remains to be seen.
