Croatia’s Dioki granted 40-day extension on key creditors’ meeting

05 July 2013 15:58  [Source: ICIS news]

LONDON (ICIS)--Croatia’s finance ministry has granted polymers manufacturer Dioki a 40-day deadline extension on a hearing at which creditors will vote whether to accept the mothballed company's revised restructuring plan, the ministry said on Friday.

Following key creditors’ rejection of the initial restructuring plan on 20 June, Dioki was ordered to present an adjusted plan on how to deal with its debts of around Croatian kuna (HRK) 2bn ($344.2m, €266.3m) by 13 July at the latest.

However, ministry officials said they have now extended the deadline by 40 days because they accept Dioki’s argument that creditors need more time to assess the revised plan it is putting forward.

Among the creditors who voted against the initial plan were national electricity provider HEP.

Dioki has warned that if a compromise can not be found, the company may be forced to proceed to bankruptcy.

Croatian oil and gas supplier Crodux Plin is waiting in the wings to become a strategic investor in Dioki if a deal with the creditors can be struck.

The company has said it stands ready to agree the immediate provision of €27m in working capital, including €2m for start-up costs, on becoming a strategic investor.

Dioki's Zagreb 50,000 tonne/year polystyrene (PS) plant and 15,000 tonne/year expandable polystyrene (EPS) installation, along with subsidiary Dina Petrokemija's 90,000 tonne/year low-density polyethylene (LDPE) unit – located in Omisalj on the Adriatic island of Krk – are three units which Crodux has earmarked as potentially profitable.

All of Dioki and Dina’s units have been mothballed since late 2011, when creditors froze the companies' bank accounts through court action.

($1 = €0.75)
($1 = HRK5.81 , €1 = HRK7.51)

By: Will Conroy
+44 20 8652 3214

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