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11 Sep, 2008 10:04

Wholesale division of Eldorado declares bankruptcy

Wholesale division of Eldorado declares bankruptcy

The wholesale division of home electronics retailer Eldorado has declared itself bankrupt, according to Kommersant, citing information from the Moscow arbitration court.

The firm went bankrupt due to tax claims, the paper says. In March, it was hit with a back tax claim estimated at between $300 and $624 million.

On Wednesday, Eldorado's retail arm sold half of its shares to the Czech republic's PPF group. Kommersant says it was in the interests of the firm that its wholesale arm went bankrupt, as it held most of the debts. This would maximise the price it got for the PPF share deal.

Eldorado had a turnover of $6 Billion in 2007, and debts of around $1 Billion.