The insolvency proposal brought against ECM Real Estate Investments by Česká spořitelna (CS) bank has been rejected by Prague’s Municipal Court on the grounds that it was unclear whether the liabilities of the other creditors named in the case had yet reached the minimum 30-day overdue period, a condition for declaring insolvency.
ECM announced the filing of the insolvency proposal on Monday and the value of the Prague-listed developer’s shares sunk as much as 30 percent during trading the following day. Trading had to be halted twice, but when the court’s rejection of the petition was revealed, the stock climbed back up to an overall loss of 10.1 percent with daily trading amounting to only Kč 6.7 million. ‘[The] insolvency petition may be supplemented by other claims and then accepted by the court.’
“Please note, however, that the insolvency petition may be supplemented by other claims and then accepted by the court,” Atlantik FT analyst Pavel Ryska said in a market comment Wednesday.
As previously announced, ECM will announce its 2010 financial results on April 13 at the end of trading, and following a meeting of its Board of Directors will also present a debt restructuring plan.
ČS is one of ECM’s largest bondholders with past-due claims of Kč 7.5 million on overdue bonds and Kč 179 million before maturity as a principal on the bonds. The past-due claims reported by CS without sufficient data were those of Uniqa, Volksbank, AM Slovenská spořitelna, Conseq IM and Glancus Investments for an additional Kč 16.3 million.
