Balkan declared bankrupt in 1998, court reveals

Source:
This story is sourced from Flight International
Subscribe today »

A Sofia court has ruled that recently grounded Balkan Bulgarian Airlines was declared bankrupt as long ago as November 1998, but escaped implementation of the ruling after paying off one of its debts. The finding backs a complaint by the Israeli Zeevi group that it was misled during due diligence of Balkan before its purchase of 75% of the airline on 1 July 1999.

The court ruling, delivered on 12 March, says Balkan was declared bankrupt after failing to pay off a debt to a local insurance company, but subsequently agreed to pay the sum in installments, heading off an application to sell its assets.

The court has also called acreditors meeting for 3 April, and in the meantime has asked two trustees nominated last month to continue to supervise the grounded carrier.