Bankrupt Holland Car Plc Gets Grace to Honour Commitments

The founder and General Manager of Holland Car Plc, Tadesse Tesema (Eng.), who had fled the country two and a half years ago after filing for bankruptcy, returned on Tuesday May 12, 2015.

Holland Car was declared bankrupt by the Lideta Federal High Court on January 21, 2013, after which it was decided that the company would not pay any of its debts starting from two years prior, in January, 2011. At that time, the company was found to have assets worth 83 million Birr.

During a press briefing that Tadesse gave at the Intercontinental Hotel on Tuesday May 14, 2015, he explained that he had submitted a proposal that would enable him to have the vehicles assembled and delivered to the buyers within a year’s period and save the company from foreclosure.

“I am planning to assemble the cars when they are in the hands of the Commissioner in Bankruptcy and deliver them to the buyers,” said Tadesse.

The Commissioner in Bankruptcy is a body established by the court to supervise and preserve assets of the bankrupt estate, to deal with properties of the company and ascertain whether the creditors of the company had entered into a contract after the declaration of bankruptcy. The company had a total of 200 creditors at the time of checking.

Tadesse, who claimed that the company did not lack capacity and skilled human resource, said that it had failed to deliver the vehicles to its buyers because of the lack of finance.

“I have been looking for finance when I was in Belgium and now I have raised six million Br for the resumption of the project,” Tadesse said.

As the company had been declared bankrupt, the pending lawsuits by its creditors were suspended. Zemen Bank, which had announced a bid for the foreclosure of the properties to regain the 34 million Br loan to the company, was stopped from doing so by the Cassation Bench of the Supreme Court.

“We will first be submitting the vehicles that the creditors had ordered and then we will transfer to selling new vehicles,” Tadesse said. “We will surely come over the problem in one year’s time.”

Although the company had planned to do this within one year, 250 of its employees have resigned.

But Tadesse claims that these are not hindrances to the process saying that the more important employees are still with the company.

When the vehicles are completed and readied for delivery, they will be 25pc more expensive than the earlier prices, Tadesse told Fortune.

“We will be importing some parts to replace those that were destroyed because they had not been used for such a long time,” he said.

The company, which has faced several lawsuits, will try and gain the trust of the clients by assembling the vehicles under the close monitoring of the commission, Tadesse said.

The founder of the company had discussions with the government through the Ethiopian Embassy in Belgium until he was able to get legal protection and recommence the company’s jobs in one year.

The government had also very recently given legal protection for a year to Ermias T. Amelga, founder of Access Real Estate, to complete houses he had failed to deliver to clients.

Holland Car Plc was established with capital of 11 million Br in 2005, by a joint venture between Tadesse and Trento BV Engineering, a Netherlands company.

It is based in Modjo, 65Km south of Addis Abeba, on 1,200sqm of land. The company had been supplying cars with the brands Abay, Tekeze, Awash, and Shebelle after partnering with a Chinese company, Lifan Motors. Relations between the two had ended with Lifan Motors emerging as the dominant side supplying different models of Lifan.






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