Nova Austral bankruptcy order lifted

Nova Austral crew, Chile

The Chilean salmon breeder Nova Austral has succeeded in getting its bankruptcy order temporarily suspended.

The move will give the company breathing space as it attempts to turn around its fortunes.

It will also come as a relief to the 3,000 people in the south of the country who depend on the company directly and indirectly for their livelihood.

It has been a tough year for Nova Austral which came close to collapse a few months ago.

The company was declared bankrupt last month after two creditors claimed they had been subject to unequal agreement – a claim to which the court agreed.

However, the bankruptcy suspension is only temporary and Nova Austral’s problems do not look like going away in a hurry.

Nova Austral is said to owe around US $559m (£437m), But in January the main creditors agreed to a reconstruction package following months of wrangling.

The company told the court that the bankruptcy order contained a number of serious errors which it claimed was contrary to Chilean law, pointing out the impact bankruptcy would have on the hundreds of people who depended on the business for employment.

It also said it was looking forward to taking on the challenges the reorganisation agreement presented.

The company argued that its performance has been affected by a series of factors that have prevented the normal development of its business, including the harsh sanctions that it received from the Superintendence of the Environment (SMA).

The saga around Nova Austral looks likely to continue for several months yet.




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