Bankruptcy proceedings begin for Croatian shipyard
Croatian shipbuilder Brodosplit has confirmed that it has begun undergoing preliminary bankruptcy proceedings under the guidance of a local court.
Brodosplit filed for pre-bankruptcy with the Split Commercial Court when it was unable to fully withdraw two loans issued by Moscow-based VTB Bank after the latter was impacted by Western-imposed sanctions in the wake of Russia’s ongoing invasion of Ukraine.
The two loans, which have a total value of around €120 million (US$128 million), were originally intended to finance two large newbuilding projects as well as to cover other expenses. However, Brodosplit said it was able to accept only €82 million (US$87.6 million) from VTB.
Attempts by the shipyard’s management to obtain Croatian government assistance in securing the necessary financing have failed. This then led to around 1,500 shipyard employees being placed on indefinite leave.
Brodosplit now has only approximately 600 personnel at its Split facilities to continue working on newbuilding projects for the Croatian Ministry of Defence.