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Mura Buys Plant in Serbia, Relocation from Slovenia Not Planned

Murska Sobota, 07 September (STA) - Clothes maker Mura in partnerji, the surviving healthy core of former clothing giant from Murska Sobota, purchased on Friday the machines and facilities of a bankrupt Serbian company. Mura owners say however that the Murska Sobota facility will not be relocated.

The machines and three sewing halls were bought for EUR 2.1m from company Prvi maj located in Pirot, some 60 kilometres SE from the city of Niš.

Mojca Lukančič of AHA group, the owner of Mura and partnerji, told the STA that they would not move anything from Slovenia, adding that this would be an opportunity for Mura to regain the strong strategic position it had held in the past.

The purchase of the facilities will enable a five-year deal with German company Hugo Boss. The workers in Slovenia and Serbia are planned to produce a total of 1,600 items of men's wear daily. They will also sew women's clothes, according to Lukančič.

In Pirot, the company expects to hire some 1,000 people by the end of the year. For hiring people in Serbia, Mura will get an incentive of EUR 6.6m from the Serbian government.

The move was undertaken, as Mura's partners demand lower production costs and branching out onto the cheaper Serbian market will allow the company to reduce the average production costs.

Labour force in Serbia is some 60% cheaper than in Slovenia, the daily Delo noted when reporting about Mura's plan to buy the Pirot plant in August.

The incentive will be paid out in four instalments, the last one after the company fulfils the condition of rehiring all of Prvi maj's 1,328 workers. Mura has three years to meet the demands for the funds, but Lukančič believes they could reach the figure by the end of next year.

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