Government Can’t Endorse Proposed Overhaul of Uljanik

Total Croatia News

ZAGREB, March 28, 2019 – The proposed restructuring of the ailing Uljanik Group cannot be accepted by the government, as that plan would entail a huge exposure of the state to this problem, however, the government is open to the search of additional solutions for the shipyards in Pula and Rijeka, Prime Minister Andrej Plenković said in Zagreb on Thursday.

Plenković recalled that last week the Croatian public was informed about figures and restructuring costs from the plan, which should be covered by the state budget.

The proposal of the recently selected strategic partner Brodosplit and its owner Tomislav Debeljak, means that the aggregate costs could reach 10.8 billion kuna, and could not be lower than 7.5 billion kuna.

In that scenario, the Croatian state would be expected to provide profuse aid which would mean “great financial exposure”, which would be definitely a huge burden on Croatian tax payers, the premier told his cabinet.

Therefore, the viability of the proposed restructuring plan is uncertain, the prime minister said.

Rijeka Commercial Court on Thursday once again adjourned a hearing that should have determined whether conditions have been fulfilled to open bankruptcy proceedings at the 3 Maj dock, and the next hearing is scheduled for April 17.

Judge Liljana Ugrin adjourned the hearing with the consent of workers’ representatives and the shipyard’s Supervisory Board, the Uljanik company and the temporary trustee for that Rijeka-based dock. “If the government in the meantime decides that it won’t be bailing out 3 Maj, a hearing can be convened by phone and there is no need to wait for April 17,” she said.

Receivership for the dock, which is part of the Uljanik Group, was sought last year by the Fina financial agency because of overdue liabilities for a period of more than 120 days which then amounted to 72 million kuna. In the meantime, that amount increased and on March 12 the debt had grown to 91 million kuna, 18.7 million kuna of which refers to workers’ wages.

The first bankruptcy hearing was originally scheduled for February 6 but shifted to February 26, then to March 12 and again for March 28. The rationale for the adjournment then was the same again with an explanation one should wait for a possible agreement on the payment of wages and the continuation of production.

More news about Uljanik can be found in the Business section.


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