Business News


Svea Gets State Loan Guarantee

Ljubljana, 13 June (STA) - The government approved on Thursday a EUR 3.6m guarantee for a liquidity loan for kitchen maker Svea, which will be conditional on a EUR 6m debt-to-equity conversion and commitments by the company and the Zagorje municipality where it is based.

Svea must withhold from paying dividends for three years and "not overdo" with wages, Economy Minister Stanko Stepišnik said.

The company will also step up exports. If it does not meet these targets, the guarantee is "the last thing the government can do" and bankruptcy will follow, he said.

The Zagorje municipality, on the other hand, must forfeit the local real estate tax for a three-year period and help in finding jobs for 180 redundant workers out of the current 310.

The decision comes after the the majority shareholders decided to transfer their shares onto the state for free in exchange for aid.

The government's reluctance to extend aid prompted Svea workers to launch an all-out strike on Monday.

They threatened to file for receivership over unpaid wages if the aid is not forthcoming.

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