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Victoria Mindova

Solving the financial puzzle tangled by Laurentios Laurentiadis is part of the legacy that the new year will take over from the old troubled 2011. One of the biggest scandals in Greece in 2011 was the revelation of some of the troubled deals around Proton Bank and the pharmaceutical giant Alapis. They proved to involve hundreds of billions of euro, businessmen soaked with the scent of political support and interest of people and corporations hardly approachable even by God.

Somewhere out there shows up the name of the Bulgarian businessman, investor and former head of the State Agency for Tourism Mario Al-Jebouri, although according to Greek sources of GRReporter, he is a minor player in the financial drama with main character Laurentiadis.

In a conversation with Victoria Mindova, the chairman of the trade union organization of the Alapis employees Nikos Livadas gave interesting details of how from a successful firm the pharmaceutical company has come to beggary. He represents 1,200 people who are likely to remain in the street if things do not go better.

When did you find out that there is a serious problem in the company?

Problems appeared last year. Financial results for 2009 were positive. The balance at the end of 2010 was negative -900 million euro. These losses were registered after the company had to write off approximately 800 million euro due to overestimated assets. In other words, much of the company property was valued at prices much higher than the actual ones, which resulted in an artificial write-up of existing assets. This was the first alarming signal that came in late 2010. Then the collapse of the shares of Alapis followed. At the end of last year, the stock price of the company was about 980 million euro and now it is 2.3 million euro. These are the general facts. We, the staff, however, experienced the development of the problems inside.

Alapis structure can be divided into four parts. The first part relates to production, the second is the logistics and warehousing, the third relates specifically to warehouses and distribution of medicines. Here I would like to add that the company holds between 25% - 30% of the distribution of drugs throughout the country, both from imports and domestic production. One of the largest companies in the distribution sector is the subsidiary of Alapis, "Marinopoulos-drug stores." The fourth structure is purely commercial - representation and sale of disposables, both from domestic production and imports.

Problems started simultaneously on all fronts. Many important collaborations with major international firms were lost because the company had no cash to make the due payments for the products, which they had provided on the Greek market. I can give an example of a large German company manufacturing products to fight cancer. We lost the contract with it because Alapis owed large sums, which it was not able to pay. Similarly, we lost all companies that were using our logistic services. I have to stress that our logistic centres meet the highest standards and have modern equipment, but the problem of making the payments on time was crucial. As for production, we did not pay our obligations to the suppliers, which are also major international corporations.

Finally, our warehouses were affected and their activity ceased in the middle of the summer. They act as wholesalers and the reason for their ceasing activities was that they took goods and medicines from large producing companies, distributed them to pharmacies, but did not pay those who had supplied the goods.

Apparently, all these actions are the result of a lack of available funds, but how did it come about so drastically?

Yes, we could say that the reason is the lack of liquidity, but we should have avoided it. Alapis gained 1.3 billion euro on the stock market by increasing its equity only two times (in 2007 and 2009). Then, it became clear that in addition to these funds, the company has taken approximately 1.2 billion euro in additional corporate loans from local and foreign banks. For about three years, Alapis got 2.5 billion euro in total. Despite the entire flow of funds, today we are talking about a company that is not working. Its factories are not producing, its warehouses are closed, the logistics centres have lost all their customers and the commercial department is operating with about 10 types of medicines down from 200 different medicines that the company offered and represented on the Greek market recently.

All these actions of the shareholders you are describing now are of high risk and seemingly, of dubious results. What is the reason for the policy pursued by the owners / shareholders in your opinion?

We the employees knew what was going on too late. The truth is that not all the executives who passed through our company, including your compatriot Mario Al-Jebouri were related to the market of medicines or their production. One of the executives came from the publishing business, another one had general knowledge of economics, the third person was appointed only because of his close friendship with Laurentios Laurentiadis. To summarize, the first reason for the company's current situation is the management’s lack of knowledge about the specific market.