Slovenian car industry supplier Cimos is closing down its TMD Casting plant in the Bosnian town of Zenica as part of its restructuring plan, the company told Slovenian Press Agency (STA) on August 8.
The restructuring programme was launched after Cimos was acquired by TCH Cogeme, a subsidiary of Italian fund Palladio Finanziaria, in May.
Cimos has already started closing its FAM factory in the northern Serbian town of Secanj after sending 130 workers on forced leave, again as part of its business restructuring plan for all the regions where it operates.
Cimos started the procedure for shutting down the Zenica plant on August 1 after talks with potential investors failed, according to STA.
The group is continuing with restructuring in all the regions where it has production facilities, Cimos also told STA.
"The process includes a series of measures on different levels, including sales and shutting down individual business units or companies, which will have long-term positive effects and help increase the group's competitiveness as well as long-term security of other employees and not least set firm foundations for Cimos's growth," the company said.
The plant's closure will be conducted in line with Bosnian law and employees will receive severance pay, Cimos asserted. It has also launched activities to help the redundant workers find a job elsewhere in the industry, STA said.
The company would not, however, comment to the news agency on recent developments in Slovenia, where some workers were also dismissed due to lack of new orders.
Cimos had been suffering from a financial crisis until the takeover by TCH. TCH plans to invest heavily into Cimos, providing €35mn by the end of this year, and a further €50mn in the next three years.
The funds will be invested into fixed assets to rationalise and consolidate Cimos's industrial base, to put the group in a position to successfully manage the cyclical downturns and upturns of the global automotive market, TCH CEO Gino Berti said on May 18.
Cimos was one of more than 30 companies designated for privatisation in 2016 by Slovenian Sovereign Holding, which manages state stakes in companies. It was sold after a lengthy effort to settle the claims of Croatia's state agency for deposit insurance and bank resolution against Cimos, which resulted in TCH temporarily withdrawing from the deal before eventually closing it once the issue was resolved.
Cimos has a workforce of just over 4,000, with about 1,500 in Slovenia, over 1,000 in Croatia and the rest in Serbia and Bosnia & Herzegovina.