Octagon, one of the largest construction companies in Romania, controlled by Greek businessman Alexandros Ignatiadis, filed for insolvency on March 22. The company had RON 65 million (EUR 14 million) turnover and RON 60 million (EUR 11 million) debt at the end of 2017.

The company decided to file for insolvency itself after several of its creditors received from court writ of execution for their claims. The company has been squeezed between the rising cost of inputs (labor and construction materials prices) and the tight price of the outcome agreed in advance with the developers.

"The main reason for the company’s financial problems was the increase in the price of construction materials and labor cost, amid contracts signed in 2017 under non-negotiable terms," company representatives told local Profit.ro.

Founded in 2005, the company has been involved in various projects such as the Baba Novac residential complex, Hermes Business Campus, Sky Tower and Green Court office buildings, and the Auchan shopping complex in Drumul Taberei, Bucharest.

editor@romania-insider.com

(Photo source: Facebook / Octagon Contracting & Engineering)