The bookstore chain cited rising debt and losses incurred during the lockdown period when its stores were closed.
“For Diverta, CITR proposes a reorganization plan with focused stages for a quick recovery,” said Aurel Podariu, Business Development Manager of Impetum Group and Senior Partner at CITR.
The judicial administrator will seek to focus on the brand’s most profitable areas, as well as financial and operational restructuring.
“The pandemic which started with the closure of stores and movement restrictions meant a considerable slump in sales for Diverta and traditional retail in general, coupled with mounting debt towards suppliers. This had a domino effect and affected the business,” said Amalia Buliga, CEO of Diverta.
Diverta currently operates 22 bookstores, after eight units were permanently closed in 2020. Diverta currently has 180 employees, 30% fewer than at the beginning of 2020.
This is not the first time Diverta resorts to insolvency procedures. The company went insolvent in 2010 but managed to bounce back. At that time, it had 62 stores, then less than 50 in 2011 and just 30 in 2012.
Diverta is operated by Blor Retail, which had a turnover of RON38.9 million in 2020, down 39% compared with 2019, according to finance ministry data.
The company is owned by Diverta Holding Invest, owned by Anca Otilia Radu (43%), Octavian Claudiu Radu (42%), Amalia Buliga (10%) and other shareholders.