Slovenia shipyard in administration

The creditors of struggling shipyard Ladjedelnica Izola have backed a proposal to send the company into administration in order to bring it out of its debts. The measure was proposed by the management in a bid to avert the outright bankruptcy of the company.

The company, which has been struggling with debts for three years, has so far failed to be rescued through restructuring. Slovenia’s lone shipyard has amassed debts of SIT 2.4bn (EUR 10m), including half in outstanding mortgages.

The mortgage creditors will be reimbursed fully, while other creditors will get 20% of their claims within a year. As part of administration, which is to enter into force in eight days, the company intends to sell land and buildings to cover debts. Debts are also to be paid from current operations.

The company intends to sell a quarter of 24,000 sq. metres in land and half of the 8,000 sq. metres in buildings, thereby acquiring SIT 1.3bn (EUR 5.43m).