MFB cancels Zsolnay loan, liquidation can begin in 15 days

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Hungarian state-owned Development Bank (MFB) canceled the HUF 413 million loan provided to porcelain maker Zsolnay Porcelánmanufaktúra, and if the company fails to comply with the repayment scheduled in 15 days, the lender will start liquidation of the company. This comes in the wake of Zsolnay majority owner airing concerns of a suspected “hostile takeover”.

Confirming yesterday’s press reports about the possible liquidation, Iván Szabó the legal representative of the local council of Pécs, Zsolnayʼs minority owner, told Hungarian news agency MTI that the loan matured last August and was canceled on May 18 after a shareholders meeting. 

Not long after Zsolnayʼs majority owner Bachar Najari aired concerns of a “hostile takeover”, reports yesterday suggested the MFB decided to launch a liquidation procedure against the company in the event that it fails to comply with the loanʼs repayment scheduled.

According to reports yesterday, the local council of Pécs had already set up a company with the name Ledina Kerámia to take over the operation of the porcelain manufacturer in the event that it is liquidated, but this was not confirmed in the MTI report today.

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”.

Following this statement, the majority owner announced at a general meeting that he had initiated the squeeze-out of the companyʼs minority owner.

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