Insolvency proceedings in Prague’s municipal court against developer ECM came to a halt Dec. 3 when the insolvency petition was withdrawn. The petition was lodged Nov. 4 as a result of unpaid interest on bonds valued at Kč234,000. In October ECM decided to defer interest payments on the foreign bonds as a way to go ahead with the company’s debt restructuring plan.
The developer issued its third-quarter results Nov. 16, which included losses of €69.9 million since the beginning of the year as well a 64.5 percent drop in net rental income to €4.2 million. Furthermore, ECM’s total equity went to minus €45.9 million. Property disposals carried out over the quarter included a project in Ryazan, Russia, that brought in €18.7 million and a reduction in the company’s ownership stake in the ECMall in China to 37 percent.
The relatively small amount of the bond interest repayment is dwarfed by the company’s other debts, which include recently prolonged bridge loans for its Epoque Residential and City Parkview projects totaling Kč 160 million that come due in December 2010. They also extended a €4.5 million Poznan Residential acquisition loan until August 2011.
