Crisis erupts around Exel Aviation
31 January 2005, AMSTERDAM — A crisis set in around the embattled Exel Aviation Group (EAG) on Monday amid reports that the company will soon request a moratorium on debt repayments and the shock resignation of its interim director.
31 January 2005
AMSTERDAM — A crisis set in around the embattled Exel Aviation Group (EAG) on Monday amid reports that the company will soon request a moratorium on debt repayments and the shock resignation of its interim director.
Company owner Erik de Vlieger sparked the controversy when he announced that the company's debts are rising significantly on a daily basis. He accused justice officials of placing the company in difficulty by involving him in criminal investigations. He warned the company might request a suspension of payments in coming days.
The real estate, aviation and media tycoon was held by police in Amsterdam last week for several days on suspicion of extortion at a city café. De Vlieger denies the allegations and now claims EAG suppliers cancelled lenient repayment arrangements due to his arrest.
The head of the Dutch pilots union VNC, Henri Popelier, explained that EAG will probably be confronted in the near future with demands for immediate repayment. "Things will then go quickly downhill for the company," he said.
And the crisis deepened later on Monday when interim director Bart Drechsel resigned, claiming he could no longer work with De Vlieger. He said De Vlieger's actions were unacceptable. He said that a capital injection from two financiers has been put in jeopardy, RTL News reported.
EAG has been struggling financially for some time, but employees were left in the dark about the looming debt moratorium. Outraged unions said personnel only learned about the impending fall of the company from newspaper reports, news agency ANP reported.
The airline group recently announced "drastic measures" to restore profitability, but De Vlieger contradicted this by saying that the company will soon need to request a suspension on payments. "It is not wise to continue," he told newspaper De Telegraaf.
De Vlieger recently announced his decision to offer up for sale to present management his business interests — grouped under the name Imca Group — due to ongoing negative publicity and judicial investigations.
But he also indicated willingness to re-invest heavily into EAG as a shareholder to rescue the company.
The 45-year-old's business partner and director of EAG subsidiary Dutchbird, Harm P., was recently arrested for money laundering, forgery and fraud. EAG has since gained a "nasty smell", Popelier said.
Amsterdam Court declared Dutchbird bankrupt last week, resulting in the loss of employment for 250 workers. The airline gained a suspension on repayments at the end of December 2004, but talks with all potential investors have since stalled.
De Vlieger has since said that judicial inquiries have made it impossible to continue in business and appears ready to throw the EAG towel in.
Nevertheless, travel agencies have reassured anyone booked to fly with EAG that their planned trips will go ahead as scheduled.
[Copyright Expatica News 2005]
Subject: Dutch news