Foreign investor who partnered with Pécs faces liquidation
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A foreign businessman who partnered with a city is apparently losing his business after losing the support of state and local officials. A liquidation proceeding was launched against Pécsʼs Zsolnay, a porcelain manufacturer whose majority owner expressed concerns of a “hostile takeover” by city representatives.
The procedure was launched by an unnamed Hungarian-owned construction company, who purchased a debt that Zsolnay had with the state-owned Hungarian Development Bank (MFB), local portal pecsma.hu reported.
Bachar Najari, a Syrian-born businessman who acquired a 74.5% majority stake in the company from now minority owner Pécs local council in 2013, in a statement earlier aired concerns about what he believes could be an “intended hostile takeover” supported by “representatives of the minority owner”.
The Municipal Court of Pécs has three days to appoint a bailiff to hear the case, Hungarian news agency MTI reported on Friday.
Lázár said on Thursday that the Hungarian government “backs the efforts by the municipal council of Pécs”, which is the minority owner of porcelain maker Zsolnay Porcelánmanufaktúra. He added that the Hungarian government has taken the side of the local council of Pécs in the “Zsolnay matter”. He said that the “apparent owner” of Zsolnay cannot count on further support from state-owned MFB or the government.
At the end of May, MFB canceled the HUF 413 million loan provided to Zsolnay, and said if the company failed to comply with the repayment scheduled in 15 days, the lender would start liquidation of the company. Zsolnayʼs majority owner reportedly said it planned to sue the MFB for its decision to cancel the loan.
The staff of Zsolnay resigned from their jobs on June 7 en masse, effective immediately, abandoning the company for the newly formed Ledina Kerámia, which was set up by the municipal council of Pécs.
Following this statement, the majority owner announced at a general meeting that he had initiated the squeeze-out by the companyʼs minority owner.
The Zsolnay factory is a historic ceramics works, producing decorative porcelain for more than 100 years. It is considered an important legacy of the town of Pécs.
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