Real Estate of Former Prime Minister Valentić’s Company at Public Auction

The Commercial Court has issued a ruling that the real estate of Niva Engineering in bankruptcy, a company founded by Niva d.d. of former Prime Minister Nikica Valentić, which owes creditors more than 130 million kuna, will go to public auction, with the conditions and manner of sale to be determined by the court later.

Court rulings published on Wednesday listed the first properties to go to auction as land in Jastrebarsko of approximately 58,000 square meters, one of which is planned as a railway corridor and the other as construction land.

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On these lands, with an estimated value of nearly 1.9 million kuna, some of the largest creditors of Niva Engineering – H-Abduco and Prima Investments – have preferential rights. Additionally, the planned electronic public auction has also announced the sale of two apartments in the elite Nazorova Street in Zagreb, estimated at around 750,000 kuna.

The decision to sell the real estate of Niva Engineering followed last year’s opening of bankruptcy proceedings at the request of creditors H-Abduco, Prima Investments, and HUP Zagreb.

Prior to that, in October 2016, a shortened bankruptcy procedure initiated at the request of the Financial Agency (Fina) was suspended as it was determined that Niva Engineering had assets that could satisfy its creditors. According to Fina’s claims from the request for the implementation of the shortened bankruptcy procedure from August 2016, Niva Engineering then had unpaid payment bases amounting to about 5.5 million kuna in an uninterrupted period of 120 days.

Furthermore, in the report of the temporary bankruptcy trustee regarding the existence of reasons for opening bankruptcy proceedings from April 2017, it was stated that Niva Engineering “has no prospects for the continuation of the debtor’s business, as the company has ceased operations” and that “the bankruptcy reasons of insolvency and over-indebtedness have been met”.

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However, by then, the debts of the company had significantly increased. According to Fina’s records as of March 31, 2017, Niva Engineering had unpaid obligations amounting to as much as 50.1 million kuna and had been in continuous blockage for a total of 180 days.

After the opening of bankruptcy and the holding of an examination and reporting hearing, in September 2017, the claims of about forty creditors of Niva Engineering were established, totaling more than 130 million kuna. The largest creditor listed is Zagrebačka Banka, which claims 58.5 million kuna, followed by H-Abduco with 37.9 million, Erste Bank with 13.8 million, and Prima Investments with 10.1 million kuna. Interestingly, the company’s debt within Valentić’s group to the City of Zagreb exceeds six million kuna.

Niva Engineering is registered as a construction, design, and supervision company with a share capital of 16.7 million kuna and is headquartered in Gradišćanska Street in Zagreb, where the parent company Niva d.d. is also located, managing all companies of that holding.

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In addition to Niva Engineering, the Commercial Court in Zagreb also called on creditors of Niva d.d. last October to propose the opening of bankruptcy proceedings for that company, which has recorded a debt of about 1.35 million kuna.

The company Niva d.d., registered as a joint-stock company for managing holding companies, was founded in 1995 with its headquarters in Gradišćanska Street in Zagreb and a share capital of 120,000 kuna. According to Fina’s reports, the subsidiaries of Niva d.d. are Niva Engineering, Črnomerec Center in bankruptcy, Niva Real Estate, SK-735, and Niva Service, with shares in the company SK-735 and Črnomerec Center in bankruptcy sold in June and April of the year before last, respectively.

Former Croatian Prime Minister Nikica Valentić served as the director and CEO of Niva d.d. from 1997 to 2011, and at the end of 2015, he became a member and president of the Supervisory Board.