OREANDA-NEWS. On August 14, 2009 The first Russian auto maker Izhavto has filed for bankruptcy. Izhavto has submitted a bankruptcy application to the Arbitration Court of the Republic of Udmurtia, according to information posted on its website, reported the press-centre of FINAM.

The filing was confirmed by the company’s employee, while its spokesperson declined to comment. This is the first instance of bankruptcy among Russian car makers. Izhavto halted output in May and its sales plunged 69.2% over the six months (9,800 cars). 45% of the company’s staff is fired at the agreement of the parties, the company’s employee noted. The enterprise has no cash left and settlements with creditors still need to be made.

As of the end of March 2009, the company’s debt exceeded RUB 15 bn, including RUB 12.3 bn in short-term liabilities, according to the report. The company’s largest creditor Sberbank with RUB 7.74 bn holds a controlling stake in IzhAvto. The car maker also owes Ak Bars RUB 1.87 bn, with a 20.28% stake under pledge, and RUB 175 mn to Zenit Bank (against the collateral of a 3.5% stake) and RUB 829 mn to Uralsib. Izhavto owes RUB 2 bn to bond owners, in February this debt was restructured until August 26.