Indebted truck maker sold off
New owners at bankrupt Tatra promise not to lay off company's employees
Posted: March 20, 2013
Embattled truck maker Tatra is preparing for a management shakeup, but staff have been assured there are no plans to lay off workers after the Czech brand was sold at auction for 176 million Kč ($9 million).
The newly established company Truck Development officially took control of Tatra March 18, three days after being the only bidder for the ailing Kopřivnice-based manufacturer.
Tatra had been declared bankrupt just three weeks before the auction and put under distraint, a procedure that allows the assets of indebted companies to be seized, at the request of Composite Com, which is owed 650 million Kč.
At the time of auction, the company's assets were put at 1.76 billion Kč, while its debt totaled 1.5 billion Kč. According to a distrainer's report, Tatra now has only 160, 207 Kč on its accounts.
Marek Galvas, the head of Truck Development, says he has no plans to cut the number of employees or limit production, although he is planning to introduce a completely new management team.
"We don't expect any work-force cuts and want to maintain the current production capacity," Galvas said. "We want to stabilize the company as soon as possible and get on with all customers, suppliers and employees whom we don't want to fire," he added.
Truck Development is financed by the investment group J&T; however, Galvas says there are more companies involved.
"The company will continue to operate and fulfill all its obligations. We have prepared financing through loans in the order of hundreds of millions of crowns for this purpose," Galvas said.
It is believed a group of creditors linked to defense contractor Jaroslav Strnad and René Matera of Promet Group foundry will likely take an ownership stake in the truck maker.
Tatra's CEO Ronald Adams, who is currently fighting corruption charges, welcomed the company's sale and said the change in ownership would solve the firm's financial difficulties.
"I feel we have kept this company alive despite some very formidable obstacles over the past three years. On the one hand, I would love to retire as CEO, but on the other hand, I know Tatra has a great future, and I would like to see the major projects we have developed come to fruition," Adams told The Prague Post. "My future position will be up to the owners of the company. I am glad to see the working capital is coming to Tatra from the new owners."
Adams, arrested in Brno last year, has been charged for allegedly offering a bribe to then-Deputy Defense Minister Martin Barták to have further military orders placed with Tatra. The former minister, along with arms dealer Michal Smrž, has been charged over the dubious purchase of Tatra lorries for the Czech military and Adams is also a witness in Barták's corruption case.
Since 2006, Tatra has been controlled by four Czech and foreign investors, all represented by Adams. Back in 2010, Tatra cut its loss of more than 700 million Kč to 158 million Kč.
Andrew Greene can be reached at