site.btaEconomy Ministry to Take Control of Dunarit

Sofia, August 28 (BTA) - The Economy Ministry is taking steps towards the acquisition of Rousse-based Dunarit, Minister Emil Karanikolov told reporters.

Dunarit manufactures aerial, artillery and engineer ammunition, industrial explosives, and railroad maintenance and repair machines.

According to media reports, the prosecution service has pressed charges against Dunarit Executive Director Krustyu Krustev and another senior executive in the company, as well as the owner of weapons manufacturer Emko, Emilian Gebrev, who are suspected of siphoning off funds from Dunarit and engaging in money laundering.

Karanikolov said the decision was made after analysis and a meeting with the trade unions and Dunarit's executive director, the objective being to keep the company operating and save the jobs. He recalled that, under the law, such charges against Board members automatically entail the company's delicensing, which would plunge Dunarit and Bulgaria's military-industrial complex into crisis.

Although the Board members have asked to be discharged, this cannot be done because there is a legal obstacle. A court determination of August 24 which was entered in the Commercial Register on August 28 denies the company a capital increase, meaning that the new shareholders cannot take over the management and the Board of Directors cannot be discharged. Under the circumstances, the Interior Ministry has to take steps towards revoking the production licence.

Karanikolov said: "To avoid throwing the entire military-industrial complex in disarray, the Economy Ministry will step in to buy all debts to avoid bankruptcy proceedings or a sale of the company's assets."

He gave assurances that the Economy Ministry would optimize the company's operation and safeguard the jobs.