SWEDEN - Swedish transformer oil producer Nynas AB has been forced to file for company reorganisation after the banks refused to extend its loans, making the company unable to pay due debts.

"Despite loyal customers and dedicated work by our employees, we have not been able to avoid the situation that has arisen," says Bo Askvik, acting CEO of Nynas.

The US sanctions against Nynas 50 % shareholder, Venezuelan PDVSA, have eroded Nynas profitability over time. Due to PDVSA's ownership, Nynas has been affected by US financial restrictions since August 2017, according to the press release.

Recently, the company has also been stopped from buying crude oil from Venezuela which has been replaced with other crude oils. This has resulted in increased raw material costs. As a result of the sanctions, the company had high financial prices and lost business because of the sanctions.

The banks that have been financing the business for a long period have chosen, in their current form, not to support the company's change work. As a result, Nynas has no option but to request a company reorganisation.

"In the short term, we see no other opportunity than to request a reorganisation, in the long term, we see good conditions to continue the business. Nynas has a strong offering with good demand from the market," says Bo Askvik.

Source: Press Release