First Logistic&Distribution ceases operations

The fund could recover almost $5 million when the proceedings are over, First Logistic&Distribution CEO, Eric Carter, told Business Standard.

Since 1999, the fund has invested some $7 mln (€7.8 mln, at an average USD/euro ratio for the last eight years) in FLD, money that could not be recovered. The investment fund initially planned to sell the company, but could not find a buyer for it. Liquidation was seen as the only solution to recover part of the invested funds.

Following this procedure, the shareholder will recover FLD’s profits for 2003-2005, amounting to $4.5 mln (€3.7 mln, at the exchange rate of that period), and a further sum is to be obtained from the sale of the company’s assets, worth some $300,000 (€217,500), according to Carter.

FLD posted last year €15.4 mln in turnover, 35 percent down from 2005, and losses worth €380,000. In 2005, the company’s profits amounted to €660,000, according to data published on the Finance Ministry website.

FLD was a distributor of consumer goods, both foodstuffs and non-food products, and was providing logistics and transportation services for textile exports. The company was operating 11 logistic centers, including one in Bucharest, and owned more than 200 vehicles. FLD was employing 230 people, according to the latest data available.

The company was founded in 1997, following an initial investment worth $2 mln, under the name of First Romanian Distribution. In 1999, the Romanian Investment Fund added some $6 mln to FLD’s capital, and a further $1 mln in 2001.This is the year the company changed name to First Logistic&Distribution.

The local distribution market is currently estimated to several billion euros, given that Interbrands Marketing&Distribution, the market leader, posted net sales worth €766.8 mln in 2006 and plans to enter the billionaires’ club this year. The second largest company in the field is Top Brands Distribution, with €170 mln worth of net sales in 2006.