Prilep tobacco company faces bankruptcy

Prilep tobacco company faces bankruptcy

Prilep's tobacco company "Tutunski Kombinat" is facing bankruptcy due to huge financial debts, Utrinski Vesnik reads.

With monthly distribution of 130 tonnes, failed agreement with "Philip Morris", extremely high costs due to overemployment, debts of Euro 80 million which are three times higher than the firm's property, functioning of Prilep's tobacco giant is not possible, well informed sources said.

According to them, the single alternative is transformation of the company and financial consolidation, which is impossible without drastic staff reduction and selling the company to a strategic investor.

Analysis show that two-thirds of 1,160 workers are redundant. Yet, the model of final privatization will be decided by the Government, as an owner of 45 percent of capital in this tobacco factory.

Managers have already outlined a business plan, which stipulates partition of the company in two-daughter firms "Tobacco" and "Cigarettes".

The plan anticipates reducing the staff through offer of social packages and renting part of the assets, business premises and vehicles.

This plan is yet to be discussed with Prime Minister Nikola Gruevski and the competent ministries.

Through the years, debts of the company have amounted to Euro 80 million, and the company remained without property, as it is indebted in comercial banks with several mortgage loans.

Most of liabilities are towards Public Revenue Office, Pension Fund and Commodity Reserves Bureau.

About Euro 30 million are debts towards the banks, which have been regularly repayed.

- There is an unsettled debt of US$ two million towards one bank from Ohrid, which can be settled through regular installments, Tutunski Kombinat's director Toni Dimitrioski said.

According to him, the only way out of this situation is transformation of the company and making efforts for bringing back the lost markets.

"We are exporting in Kosovo, Bosnia and Hercegovina and in Iraq. Thirty tonnes are exported to foreign markets each month. At present we possess one quarter of domestic market with monthly distribution of 100 tonnes. Still, due to smuggling, which takes up 30 percent of total distribution at the FYRMacedonian market, our monthly losses are about 10 tonnes", Dimitrioski said.

Due to disrespect to the main principles in tobacco business, foreign partners withdrew from the company due to their dissatisfaction from the cooperation, managers said.

Managers stated that there is still hope for the company, because foreign markets are more and more interested for oriental tobacco, which at present is sold for Euro 3,4 - 4 per kilo.

Two renowned European companies also showed interest for Prilep's tobacco company.