Tuesday, September 4, 2012
Polish Builder PBG Seeks $60 Million In State Aid
Wed., September 5, 2012
Stricken Polish builder PBG is seeking a 200 million zlotys ($60 million) loan from state-controlled industry development agency ARP, its chief executive was quoted as saying on Tuesday, as the company battles to stay in business, Reuters reported. "We will amend our motion to ARP by the end of this week," state agency PAP quoted Wieslaw Rozacki as saying. "We are filing for help of 200 million zlotys." PBG is the biggest Polish builder to run into financial trouble in the wake of Poland's 20 billion euros spending spree to upgrade its infrastructure ahead of the Euro 2012 soccer tournament, a programme that featured fierce competition for contracts between local and foreign builders. At its peak worth some $1 billion, the group is now valued at just $22 million after it ran into solvency problems partly because it took on deals with razor-thin margins to build motorways, only for prices of building materials to soar. PBG, in bankruptcy protection since June, posted a 1.7-billion zloty net loss for the first half of the year, after huge writedowns took their toll in the sector, hitting also PBG's top rivals Polimex and Budimex.