Croatian ministry wants Dioki rescue deal by end of March

08 March 2012 17:05  [Source: ICIS news]

LONDON (ICIS)--The Croatian Labour Ministry is pushing for an ownership restructuring deal that would rescue the debt-ridden Dioki Group by a March 31 deadline, the ministry said on Wednesday.

If no such arrangement was agreed by that date, the low density polyethylene (LDPE) producer might have to be subjected to bankruptcy, it added.

The company’s 350 workers, who have gone unpaid for six months, were told by the ministry at the end of January that a deal with Dioki’s creditors, which would allow production to resume and owed wages to be paid, was imminent.

However, the talks between the company, ministry officials and creditors — who include the gas division of Croatian group INA, which provides Dioki with ethane, and state-owned electricity provider HEP — had unfortunately not made the rapid progress expected, the labour ministry said.

Some workers are continuing to stage regular demonstrations outside Dioki’s plants.

These include a 90,000 tonne/year ethylene cracker in Zagreb and a 200,000 tonne/year vinyl chloride monomer (VCM) plant on the Adriatic island of Krk.

All Dioki’s installations have been mothballed since the end of last year when the company’s bank accounts were frozen following legal action from creditors.

By: Will Conroy
+44 20 8652 3214

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