Montenegro’s state-owned shipping company, Crnogorska plovidba, is facing imminent bankruptcy. Even after selling its only significant assets—two ships, “Kotor” and “21. maj”—the company will remain with debts of around 26 million euros.
According to the 2024 audit report, the company owes at least 37 million euros. The ships are being sold for a total of 11.2 million euros, leaving a substantial shortfall, primarily owed to the state. The company has no other significant assets, making bankruptcy likely.
Both vessels were purchased in 2012 with a loan from China’s Exim Bank totaling 55.7 million dollars. After depreciation, their book value was estimated at 30.4 million euros, meaning they are being sold for just 37% of their accounting value. Remaining assets, including spare parts, equipment, and office supplies, are valued at only 2.3 million euros.
Financial indicators show the company is at high risk of insolvency. The Altman Z-score was -0.88, well below the 1.1 threshold signaling imminent bankruptcy. The Bex index was 0.18, and the Zmijewski model showed 1.79, all pointing to severe financial distress.
The government approved the sale of the ships to Danish company K/S Navision Group for 11.2 million euros. The initial highest bid came from Turkey’s EOS Group, which offered 16 million dollars but was excluded after contract complications. EOS Group has indicated potential legal action over reputational damage.
Operational issues have worsened the company’s situation. The “Kotor” experienced multiple breakdowns this year, its account was blocked due to unpaid debts, and growing obligations further strained finances.
Crnogorska plovidba’s CEO, Vladimir Tadić, has declined to comment on the future of the company or the use of proceeds from the sale, referring inquiries to official channels.
In summary, the combination of massive debts, depreciating assets, and operational setbacks leaves Crnogorska plovidba with little ability to recover, making bankruptcy highly likely despite the planned asset sales.
