Croatia's diversified group Djuro Djakovic [ZSE:DDJH] said its unit Djuro Djakovic Industrijska Rjesenja (DDIR) has entered pre-bankruptcy proceedings.
The commercial court in Osijek opened the pre-bankruptcy proceedings on January 30, Djuro Djakovic said in a filing with the Zagreb Stock Exchange (ZSE) on Thursday.
DDIR submitted its request to the commercial court in Osijek on December 27.
In October, the group revealed that it has been in talks with creditors, trying to resolve a liquidity crisis which had left it short of funds to pay out wages to its employees. The group and two of its four affiliated companies were unable to pay their workers the September salaries.
In November, the group eventually managed to pay out the delayed September wages, following which the wrokers halted their strike and returned to work. However, later on, the workers staged protests again, seeking payments of the November wages, which they received at the end of the year.
Earlier this month, Djuro Djakovic signed a 150 million kuna ($22.2 million/20.2 million euro) loan agreement with local lender Hrvastka Postanska Banka (HPB) supported by state guarantees. The loan is intended to help the group pay debt to suppliers and the state, as well as to buy materials needed for the completion of three important contracts that have been in progress.
The group will undergo a restructuring process in the next six months, after which an estimate will be made whether there is a need for job cuts.
Djuro Djakovic's shares closed 4.72% higher at 4.66 kuna on Thursday. They did not trade by 1050 CET on the ZSE on Friday.
The group's main business lines are manufacturing of equipment for steelworks, industrial and power plants and production of rolling stock and special-purpose motor vehicles.
(1 euro = 7.44213 kuna)