Fewer bankruptcies in 2010 as A-Tec talks continue

The number of bankruptcies declined by nearly six per cent year on year in 2010, it has been announced.Creditreform, an Austrian association for the protection of creditors, said today (Mon) that officials handled 6,657 cases of broke companies last year. It said this was a 5.9 per cent decrease compared to 2009 figures. Creditreform added that around 85,000 creditors were affected by business insolvencies last year.The authority pointed out that, while the number of bankruptcies dropped, the amount of liabilities soared. Creditreform announced liabilities ranged around 4.3 billion Euros last year, up by 12.5 per cent year on year. It added Vienna registered the most business bankruptcies among Austria’s nine provinces with 2,117 cases, down by 3.3 per cent.Creditreform also said that the number of private bankruptcies edged down by 0.5 per cent year on year to 10,296 cases in 2010.Last year’s biggest bankruptcy was the one of industrial firm A-Tec Industries AG (A-Tec). A-Tec, which has around 12,000 employees all over the world, filed for bankruptcy in October after failing to provide its subsidiary company Austrian Energy & Environment (AE&E) with sufficient funds to carry out an assignment in Australia.AE&E was recently acquired by Styrian rival Andritz AG while negotiations over whether it is possible to bring A-Tec back on track continue. The firm’s liabilities range around 1.67 billion Euros.A-Tec’s bankruptcy has been met with mockery by many capitalism critics and business newspaper commentators as it marks the rise and fall of one of Austria’s most infamous “turbo capitalists”.Company chief Mirko Kovats, who used to travel to business meetings in his private jet, praised the work attitude of people in India while hitting out at students displeased with conditions at universities in Austria for “going on strike”.The businessman, who hinted he wanted to resign as head of A-Tec shortly after the company opted for organised bankruptcy proceedings, also caused controversy by claiming that “no one” would be interested in locating an industrial facility in Austria these days because of its bureaucracy and high rates of taxation.A-Tec became one of the biggest Austrian firms by acquiring struggling companies of various business sectors over the whole world to restore their finances by often laying off most of the employees. Now it seems likely that the company will be split into several smaller firms if authorities handling the bankruptcy procedure manage to find an investor in their bid to avoid A-Tec’s collapse.