Austria

Austrian drug store chain Dayli filed for court-supervised restructuring on Thursday, acknowledging it had failed to deliver on its concept for neighbourhood stores and saying nearly 3,500 jobs were at risk, Reuters reported. The filing in Linz poses a fresh test of whether Austria's strong safety net that gives it the European Union's lowest jobless rate can handle a wave of corporate failures, including that of Alpine, the country's second-biggest construction group.

The insolvency of Alpine, Austria's second-biggest construction group, takes pressure off an overcrowded sector and could help profits at rivals, the former head of market leader Strabag SE told a newspaper, Reuters reported. "In Austria we certainly have an overstaffed market. If capacity is limited, that is certainly positive for the market," Hans Peter Haselsteiner, who is still a major shareholder in Strabag, told Die Presse in an interview printed on Tuesday.

Austria committed to increase spending by as much as 1.6 billion euros ($2.1 billion) until 2016 for construction projects after a builder filed for the country’s biggest post-World War II insolvency and put 5,000 jobs at risk in an election year, Bloomberg reported. The measures decided in the weekly government meeting in Vienna today include both new projects and bringing forward planned ones to this year and next year, Chancellor Werner Faymann told journalists today. Faymann said he still plans to balance the budget by 2016.

Alpine Bau, the insolvent Austrian arm of Spanish construction group FCC, faces being broken up after late-night talks to save the company in its current form failed, putting up to 5,000 jobs at risk, Reuters reported. The head of Alpine Bau's works council, Hermann Haneder, said on Monday a consortium of rival builders was now looking at taking over parts of the company, either at the level of provincial divisions or individual projects. "The question is, will the workers be kept on when the projects are finished?" said Haneder, who took part in the last-ditch talks.

Austrian construction group Porr has abandoned for now a 150 million euro ($201 million) bond issue planned for the start of July after peer Alpine filed for insolvency, Chief Executive Karl-Heinz Strauss said on Thursday. The move by Alpine Bau, the Austrian construction unit of Spanish group FCC, meant Porr would not now be able to sell the bond at the interest rate it wanted, he told Reuters in an interview. "We have postponed our bond plan indefinitely," he said.

Alpine Holding GmbH, the Austrian builder owned by Fomento de Construcciones & Contratas SA, started a 2.56 billion-euro ($3.4 billion) insolvency today, the country’s biggest failure since World War II, Bloomberg reported. Alpine Bau, the company’s operating unit with businesses in Austria, Germany and eastern Europe, filed for insolvency at Vienna’s commercial court today, credit protection association Kreditschutzverband von 1870 said in a statement. Alpine Holding’s insolvency filing is expected to follow in the next few days, KSV said.

Alpine Holding GmbH, the Austrian builder owned by Fomento de Construcciones y Contratas SA, may incur the country’s biggest insolvency in three years after attempts to reach a restructuring failed and were terminated, Bloomberg reported. Alpine Bau, the company’s operating unit with businesses in Austria, Germany and eastern Europe that employ 15,000 staff, plans to file for restructuring to rescue parts of the group, Alpine said in a statement yesterday. Alpine Holding will probably go insolvent in the process, it said.

Austria is seeking "creative" ways to clean up ailing nationalised lender Hypo Alpe Adria, Finance Minister Maria Fekter said on Wednesday, rejecting the option of a "bad bank" that would hit state finances before elections, Reuters reported. She also said she was confident she could get more time from the European Commission for an orderly wind-down of the bank that Austria took over in 2009 and which eked out a small profit last year.

Austria’s central bank said Hypo Alpe-Adria-Bank International AG will likely avoid a 16 billion-euro ($21 billion) insolvency as policy makers negotiate with the European Commission over the nationalized lender, Bloomberg Businessweek reported. “The government is on a very good path with the Commission, therefore I don’t think that there is an immediate threat,” Andreas Ittner, a director at the nation’s central bank, told journalists in Vienna Tuesday.

Under fire for its banking secrecy, Austria hit back at Britain and the United States on Thursday, urging them to crack down on money laundering and tax havens in their own backyards, as EU ministers prepared to debate the issue in Dublin, Reuters reported. Friction emerged before the Dublin meeting as France's budget minister warned Austria it could be blacklisted if it refused to share information on EU citizens' bank accounts, a threat Vienna dismissed as an "improper diversionary tactic".