Liberty Galaii under pressure: Czech court blocks assets of the plant
The restructuring process of the Romanian Liberty Galaii metallurgical plant has come under significant pressure due to new legal complications. The Regional Court of the city of Ostrava (Czech Republic) has decided to impose time restrictions on the company's key assets. This is reported by SteelOrbis
This procedure was the result of a lawsuit initiated by the insolvency administrator of the Czech plant Liberty Ostrava, Shimon Petak.
The conflict arose over a loan agreement concluded in October 2023, according to which Liberty Gala's debt to Liberty Ostrava exceeds €40 million. In April 2024, the Romanian side paid only interest amounting to less than 2% of the total amount owed. The existence of this debt is also officially recognized in the restructuring plan submitted by Liberty Galaii to the Romanian authorities.
Since the agreement provides for the exclusive jurisdiction of the Ostrava courts, the Czech court recognized the claims as justified and applied a temporary measure to protect the creditors' rights. The restrictions apply to specific assets: land, buildings, and major production units. Any transfer of these assets contrary to a court decision may result in legal liability and may be appealed.
Representatives of CITR, which is the administrator of the Liberty Galaii Concordat procedure, are trying to calm the market.:
- They claim that the Czech court's decision has no direct impact on the preventive restructuring procedure in Romania.;
- The temporary measure is being contested and, in their opinion, does not stop the bidding process.;
- The final method of recovery of funds will be determined by the Romanian court as part of the preventive settlement procedure.
The situation with the Czech court increases uncertainty about the future of the plant and its ability to attract a strategic investor to stabilize operations.