Thursday, July 17, 2008

Martinsa-Fadesa Romanian project still unaffected

Spanish construction and real estate development group Martinsa-Fadesa, which operates on the Romanian market, has become the first Spanish publicly listed company forced to seek bankruptcy protection after failing to get a loan to refinance debt. The firm has an ongoing one billion-euro project in Stefanestii de Jos, close to Bucharest. So the question is: what will happen next? The group was unable to get a 150 million-euro loan, which it needed for cash and the continued normal development of projects, as announced by its officials. The firm entered Romania in 1998, when it bought the majority interest in wood processing company Diana Forest based in Bacau from the state. Martinsa-Fadesa sold the company for 23 million euros to Polish flooring and parquetry manufacturer Barlinek early this year. Also at the beginning of this year it started construction works on its biggest development in Romania, Bonaire Community City in Stefanestii de Jos. The project was meant to include 7,600 flats, a hotel, office space and retail space and is the biggest residential complex announced in Romania so far. "In principle, the projects announced are still happening, considering we use different financing sources than the company in Spain, especially from banks. What we can say is that the situation in Spain is not affecting us for the time being," say the representatives of Martinsa-Fadesa in Romania.



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