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Lithuanian gov't initiates bankruptcy for state-owned shipping company

Xinhua, July 24, 2015 Adjust font size:

Lithuanian transport ministry on Thursday initiated bankruptcy for the state controlled Lithuanian shipping company, which has seen its seafarers trapped in foreign ports in recent weeks.

"Currently, most of the company's financial commitments are overdue," said the ministry in a press release announcing the initiation of the bankruptcy.

Total debts of the company amounted to 20 million euros. The company owed around 1.5 million euros to its crew members.

The transport ministry which is the main shareholder of the publicly traded company with 56.66 percent of the shares has taken the decision weeks after the ships were seized due to unpaid bills for fuel and unpaid wages.

The ministry faced accusations from Dalia Grybauskaite, Lithuanian president, for ignoring the worsening situation of the company which the president said reflects "the traditions of faulty governance in state controlled companies".

Meanwhile, Lithuanian prime minister announced an extraordinary meeting on Friday to discuss the financial situation of the shipping company with members of the cabinet, the company and the creditors.

Four out of five company's ships remained seized at ports in Italy, Portugal, the U.S. and Senegal on Thursday with around 80 crew members.

The first seized vessel with 19 crew members returned to Lithuania on Thursday, announced the transport ministry. Endit