The company has debts to suppliers, loans and back taxes of some HUF 1bn, Magyar Könyvklub president-CEO István Hegedűs said. He noted, however, that the company has operated profitably since the middle of 2005, when Switzerland's V and R Holding pulled out of the company after injecting HUF 500m into it. Magyar Könyvklub's bailiff has allowed the company to continue operating during the liquidation as long as it remains profitable.
Germany's Bertelsmann set up Magyar Könyvklub in 1992, then sold the company to Budapesti Piac, a company owned by Hegedűs, in 1998. The company expanded later with the purchase of wholesalers Saxum and 50 bookshops from Bibliofil. By 2000, Magyar Könyvklub was generating annual revenue of HUF 4-5 billion, giving it an 8-10 percent share of Hungary's book market. However, because of delayed copyright payments and problems with deliveries and stock, the company's revenue fell and losses grew. In 2004, Magyar Könvyklub restructured, drastically reducing staff, selling its shops and outsourcing its wholesale activities. V and R Holding bought a 49 percent stake in the company in the same year, but resold it in 2005 to Hegedűs's company.
Source: Hungarian News Agency (MTI)
