Garmco reaches deal with creditors

The company had faced financial distress due to global economic conditions

  
Image used for illustrative purpose. One of the last pre-cast concrete panels, is lifted onto the top of the The Breaker in Manama, May 7, 2014.

Image used for illustrative purpose. One of the last pre-cast concrete panels, is lifted onto the top of the The Breaker in Manama, May 7, 2014.

REUTERS/Hamad I Mohammed

GULF Aluminium Rolling Mill (Garmco) has announced that it has reached a final agreement with its creditors.

The company had faced financial distress due to global economic conditions, and after the issuance of Law No. 22 of 2018 promulgating the Reorganisation and Bankruptcy Law.

The company’s general assembly decided to benefit from the provisions of the law by filing a reorganisation case, according to a statement.

Following this move, it became one of the first companies to file for reorganisation under the new reorganisation and bankruptcy law.

The purpose of the law is for firms to get their financial affairs in order by restructuring and avoid liquidation.

“We were able to reach an agreement with the creditors by putting together a plan that takes into consideration the interests of both the company and the creditors,” said Garmco chairman Arif Rahimi.

“The reorganisation plan has been unanimously approved by all creditors and ratified by the court.

“It includes several essential provisions that would lead to rescuing the company from financial distress, the most important of which was rescheduling the debts and converting part of it into shares for the company creditors.”

The official added the decision will strengthen the financial position of the company, and enable it to continue its production process and achieve more sales and profits during the upcoming period.

Mr Rahimi added that the company had received support and assistance from several parties in the past two years, including Bahrain Mumtalakat Holding Company, Saudi Basic Industries Corporation (Sabic) and the Kuwait Investment Authority, in addition to other shareholders.

“The company, through the reorganisation, is looking forward to compete at a global level,” he added.

“During the past period, we successfully were able to access new markets in various regions of the world and the Bahraini product that’s known for its quality has reached North and South America, as well as Europe”.

Garmco is the first and one of the largest downstream aluminium facilities in the Middle East for rolling, cutting and fabricating aluminium.

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