Hungary’s leading fertiliser maker Nitrogemuvek, owned by businessman Laszlo Bige, has reached an agreement with investors holding 75% of its €200mn bond package on a 60-day extension of the debt, after the company missed a payment deadline last week.

The default may have triggered cross-default clauses, potentially accelerating other debts, including those owed to banks.

Nitrogemuvek plans to launch an electronic consent solicitation process, in which bondholders would be asked to waive any potential default and approve the extension. The board is still evaluating all available options and remains hopeful that a consensus can be reached with bondholders, the statement read.

Strategic director Zoltán Bige, son of the owner, said Nitrogemuvek could not pay back the principal and only interests.

Hungary’s industrial climate remains challenging due to high carbon dioxide taxes and energy costs, undermining the profitability of fertiliser production.

Bige blamed the company’s financial strain on what he described as a "discriminatory and unmanageable" tax burden, which the company is currently challenging in court. The government in 2023 retroactively slapped emitters with a carbon dioxide tax of €40 per tonne and a 10% transaction fee for selling quotas. Although the CO₂ tax was later reduced to €35, the quota transaction fee was raised to 15%, exacerbating the impact.

Bige, 67, has claimed the government’s actions were part of a campaign to force him to sell his company at a discount to politically connected oligarchs. The entrepreneur, who publicly supported opposition parties ahead of the 2022 general election, alleged that state authorities harassed him following his endorsement and that Prime Minister Viktor Orban personally intervened in regulatory matters affecting his business.

His legal troubles mounted further when Hungary’s competition authority imposed a record HUF11bn (€27mn) fine in a cartel case involving alleged fertiliser price manipulation. Bige, who was placed under house arrest in 2020, denies wrongdoing and is fighting to clear his name in court.