As a result of receivership, around 750 workers will lose their jobs at Primorje, which once employed as many as 2,500. Since most are from the Vipava valley, western Slovenia, unemployment there is to rise to 25%.
The move was expected as workers, who have been on strike since 15 May, had not received pay for April despite promises from the owners that efforts were under way to secure a strategic investor who would recapitalise the company and secure money for wages. Primorje's bank accounts have been blocked for a while and enforcers have been transporting machinery out of the company for days. "The receivership was necessary in order to stop the enforcers and set up new companies as soon as possible," Ajdovščina Mayor Marjan Poljšak told the STA.
The new companies will try to salvage a part of Primorje's business. Poljšak estimates between 50 and 100 workers could get a job that way, while a handful could find work at similar, smaller companies in the region. "Others will unfortunately have to register with the Employment Service and find a different job," he said. Labour Minister Andrej Vizjak responded to the news of the receivership by saying he hoped the Employment Service would mitigate the impact of Primorje's collapse and "find new opportunities for workers that have been suffering the agony".
Primorje ran up massive debts following a management buyout ten years ago. Its situation was made worse by the crisis, which has hit construction the hardest. According to a report by public broadcaster TV Slovenija, the company's debts amount to EUR 380m. The company also reported a loss of EUR 36m last year. Despite orders it has not been able to get the money to finance operations. The proposal for receivership was filed with the Nova Gorica District Court by head of the strike committee Damjan Volf. The document proving insolvency was signed by the only remaining management member Štefan Činč.The proposal is for receivership at three companies in the group - Primorje, Primorje Instalacije and Primorje Avtoservis, which employ a total of around 750 workers.
SOURCE: The Slovenia Times
