Váhostav has enjoyed many state orders. (source: Sme)
“The criterion for the division of the shares will be the sum of the claim,” Prime Minister Robert Fico said on April 22, after talks with the company’s management and representatives of the creditors. He also claimed, as quoted by the TASR newswire, that banks - also creditors of the construction giant - will give up a portion of their secured claims as part of the company's restructuring. This means a concession on the part of banks, the claims of which will be satisfied only to 85 percent, instead of the originally planned 100 percent, said Fico.
Unsecured creditors now look likely to receive more than 15 percent of what they were owed, which was the firm's original offer.
A proposal not to write off debts of Váhostav-SK still holds, with creditors being allowed to collect 100 percent of their claims from company’s future profits. The state also wants to offer the creditors the option to have 50 percent of their claims settled immediately via the state-owned Slovak Guarantee and Development Bank (SZRB).
Milan Blaho, representative of the creditors, said on the same day that he believes the latest proposal presented by Fico to be the best solution currently on the table. “A better solution than this is not realistic,” he said, according to TASR. “This is the only final solution that we could accept on behalf of the creditors.”
Váhostav-SK General Director Marián Moravčík said banks will give up approximately €3.5 million in favour of unsecured creditors.
Finance Minister Peter Kažimír insists the process will not have any negative impact on public finances.
“It won’t have any impact on the public debt because this is funded from the state financial assets to which banks contribute, and the truth remains that this operation will be evaluated by Eurostat at the end of the day,” he said.
The solution to the Váhostav crisis presented by Fico earlier in the day means that the cabinet will make a profit off the small-sized and self-employed creditors, Slovak Democratic and Christian Union (SDKÚ) MP and former labour minister Ľudovít Kaník claimed.
“For 50 percent, the Government will acquire the entire claim of the creditors plus their Váhostav shares,” he stated, as quoted by TASR. “Later, the state will collect 100 percent of commitments from Váhostav-SK and will enjoy the shares, too. It’s more or less certain that almost all small-sized creditors will embrace the Government’s offer, as they’ll prefer to sell their claims for 50 percent of their nominal value. They won’t wait years for more money.”
The process of receiving payments through shares would take about five years.
Businessman Juraj Široký, a longtime financier of Fico's Smer party and the primary owner of Vahostave, will win even after the act on restructuring is passed, Most-Híd MP Lucia Žitňanská told the SITA newswire.
“If the interests of Juraj Široký clash with those of state; usually it is Široký who wins, and this will be the case even after the amendment to the Business Code is passed, she added. Žitňanská deems unacceptable that the law – presented by government – will apply to many more cases of restructurings. Nobody can say today whether this law will help or harm both the creditors and the companies to be restructured.
