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BELGRADE (Serbia), November 24 (SeeNews) - Serbia will acquire a 95% stake in insolvent truck maker Fabrika Automobila Priboj (FAP) to avoid its liquidation, the Uzice commercial court said in a ruling on Thursday.
The court gave the green light to the company's restructuring plan which involves the transformation of debt worth 8.693 billion dinars ($74.5 million/70.4 million euro) into capital and allows for the resumption of production activities, according to the court ruling.
Under the terms of the plan, FAP should reach a net profit of 186.3 million dinars and become competitive in five years through an investment of 145 million dinars annually.
FAP currently has orders worth 2.3 million dinars and employs 125 workers under temporary contracts.
The Serbian Defence Ministry plans to award the company a contract for 22 trucks, managing director Milan Kostic told national broadcaster Radio Televizija Srbije (RTS) on Thursday, adding that FAP's could reach 200 in the beginning of 2017.
In February 2015, Serbia's privatisation agency called a tender for FAP, which attracted a single bidder - Finish company Sisu Auto. The bidder was believed to be close to signing an agreement but eventually withdrew from the deal.
FAP produces trucks, buses and trailers in addition to chassis and spare parts. The company was established in 1953. In 2002 the Serbian government started preparations for its privatisation.
($ = 123.390 dinars)