“I came up with the money to support the three plants and help employees restart production. After the new company is set up, whose name has not yet been decided, I will hold a 50% stake, while creditor banks will have 29%, and an 18% stake will remain in the hands of the old IRS company,” he told ZF.
Verestoy, a senator of ruling coalition party UDMR (Democratic Alliance of Hungarians in Romania), who shares his time between his public duty as a member of Parliament and his own businesses, wants to go from the wood business to railway car manufacturing. Verestoy specified there were further documents to sign in order to take hold of the 50% stake, “as this is a more complicated legal procedure.”
He did not specify what stake would be left in the hands of Cristian Burci, who could not be contacted by ZF.
Cristian Burci entered the railroad car business a few years ago, after buying Astra Vagoane Arad from American IRS. Amid the economic crisis, the three plants – Astra Vagoane Arad, Romvag Caracal and Meva in Drobeta-Turnu Severin – went insolvent, with debts of EUR120 million to RBS Bank, ING, Citibank Europe and Piraeus Bank.
The plants in the IRS group saw their turnovers shrink from EUR230 million in 2009 to around EUR75 million last year, according to Finance Ministry data.
(English version by Daniela Stoican; Editing by Loredana Fratila-Cristescu and Radu Bostan)