The Varazdin-based Varteks company, whose accounts have been blocked for almost 60 days, is going into official receivership, the management board chairman Karlo Koprek, said on Saturday.

On Friday, the supervisory board of this textile company decided by a majority vote to give a go-ahead to Koprek to initiate the bankruptcy proceedings.

Koprek told Hina on Saturday that he would meet workers on Monday to agree with them whether the proceedings would be sped up or whether the bankruptcy procedure would go on by virtue of law.

He explained that in the case of the company waiting for the FINA financial agency to conduct the bankruptcy proceedings, then workers will be without their wages for one or two months.

My proposal to the Supervisory Board was that the company itself should initiate the official receivership as I believe that this is in the best interest of employees and the company, said the board chairman.

He explains that that during the official receivership, the company will be able to pay the lease for retail shops and other overhead costs.

Koprek told Hina that the plan would be to scale down the production and reduce the number of employees during the official receivership until the company’s recovery and then re-employ former workers.

In early May, workers of this company, which is a brand of the northern city of Varaždin, went on strike over overdue salaries. They ceased their industrial action on 14 May after they were provided with guarantees that they would get their late wages and after a deal was made between the new management and shareholders and the relevant trade unions.

Unaudited data for 2023 show that last year Varteks operated at a loss of €4.43 million, while in 2022 its losses amounted to €3.1 million. Its operating revenue last year dropped by 15.1% to €14.6 million. At the end of 2023, the company had 633 employees.

In late May, the company also reported that it had presented a plan for the stabilisation of its business operations to Zagrebacka Banka and the Croatian Reconstruction and Development Bank (HBOR), making an offer that would enable it to obtain fresh money through recapitalisation and new loans, to be used for production and payment of due liabilities, however, the offer was turned down.