Equipment producer Vulcan's request to enter insolvency has been approved and Euro Insol is the new judiciary administrator of the company owned by businessman Ovidiu Tender. Vulcan has asked for insolvency because of the EUR 37 million debt it could no longer handle.

The company saw its turnover dropping to some EUR 16 million in 2012, when its loss also widened to some EUR 10 million. This was the third year in a row when Vulcan posted a loss. The company also had to service prior debt instead of investing in increasing production capacities, according to its insolvency request.

In December 2012, the company announced that it was having difficulties in ensuring work capital, as orders from clients were increasing. Its short term focus will be to attract needed financing to serve the ongoing contracts, and optimize costs via reorganization and restructuring.

Vulcan is currently working on a EUR 105 million contract with Kuwait Oil Company, for which it has to deliver 210 oil pumping units.

Vulcan has 900 employees and owes them some EUR 800,000. The company's accounts have been blocked by the Tax Administration. Vulcan, listed on the Rasdaq market of the Bucharest Stock Exchange, was temporarily suspended from trading.

editor@romania-insider.com