Iran's largest paper making group celebrated its exit from bankruptcy.

Feed: 3040 - Date: 2/12/2020 - Views: 18

After 25 year's struggling against financial hardship and shortage of raw materials, Iran's largest paper making group survived bankruptcy because of the approval made by the Headquarters of Facilitating the Country's Production and Removing the Barriers and the increase of investment.

vote: 4.00
by 2 people - Please vote
Sari, IRNA- the Managing Director of Mazandaran Wood and Paper Industries said at the ceremony, "This industrial unit survived the bankruptcy in presence of the first deputy of the President by revising the capital evaluation and by injecting 4,800 billion Rials according the President's order and the approvals of the Headquarters of Facilitating the Country's Production and Removing the Barriers."
Ali Hosseinpour announced, "After injecting new capital, it became 5,450 billion Rilas. The increase in capital has paved the way for the company to absorb banking facilities and to enjoy legal supports in order to receive facilities in foreign currencies." 
He added, "The Company has faced serious problems with the supply of wood as its raw materials, and became one the companies making loss for the last five years, but the increase in its capital will cause the company to make proper profit."
Announcing the survival of the company resulted from the supports given by the first deputy of the President, the Minister of Economy, the Central Bank and the Mazandaran governor, the Managing Director of Mazandaran Wood and Paper Industries stated, "The rise in the capital was made by several investment holdings including Shasta, Atieh Saba, and the Melli Bank which were the shareholders of this industrial unit."
He added, "The accumulated loss of the company, which was estimated at 2,510 billion Rials, was covered by the increase in capital."
Stating that the company has been active merely with 40% of its production capacity of 180 thousand tons due to the shortage of wood as the most important raw materials, Hosseinpour said, "Based on the program and according the existing raw materials for paper production in the company, the production of the company will reach 80 thousand tons up to the end of the current year."
Mazandaran Wood and paper Industrial Company is a private stock company whose shareholders are Melli Bank with 58%, the country Pension Fund with 24% and The Social Security Investment Company (Tapico) with 18% of the shares of the company. The company was one of the thirteen companies exploiting the lumbers of the Mazandaran forests.  The company had the right to exploit lumbers from around 150 thousand hectares of Mazandaran forests. At the end of the exploiting contract, the company faced problem because of the Forest Respiratory Law and became a loss making company so that according to official statistics, the annual production capacity of the group decreased from 183 thousand tons to 63 thousand tons in 2018. 
Before the injection of the new capital, Mazandaran Wood and paper Industrial Company was subject to the enforcement of Article 141 of Business Law, which states, "If at least half the capital of a company is eliminated due to the incurred loss, the board of directors shall immediately hold an extraordinary general assembly of the shareholders to vote for either the dissolution or the survival of the company. If the assembly does not vote for dissolution, it shall reduce the capital of the company to the existing amount capital at the same meeting as per the regulations of Article 6 of the Business Law. If the board does not observe the Article and avoid holding the extraordinary general assembly or the assembly cannot be held in accordance with the legal regulations, any beneficiary can request the liquidation of the company in a competent court."  
The reason for inclusion of Article 141 in the Business Law is the unpredictable economic conditions for the long term which are impacted by a lot of political, social and other variables. The Article can be applied to the companies which have lost half of their capital. 
The implementation of the ban on harvesting lumbers from the northern forests had been accomplished over a three-year period by last year. Based on this law, the exploiting contracts of all companies to harvest wood from the forests were terminated and have not been extended any longer, so the reduction of production on one hand and the working costs and debts to service companies which were announced to be over 2 thousand billion Rials on the other hand have put this large paper making company on the verge of bankruptcy.
Mazandaran Wood and Paper Company started operation in Sari in 1997 and is considered the most important paper producer in the country. The company plays an important role in the employment of Mazandaran province by providing direct occupations for 1,300 people and indirect employment for several hundred people. 
 
 

[Back to list]
Directory Categories:
New Members: ● Arteck group limited   ● Narumon Paper Industry Co.,Ltd   ● Dongguan Xinwu Trade CO.,Ltd   ● Al Faisaliah Group (AFG)   ● KFP Corporation