ITAS-Prvomajska from Ivanec, the only factory in Croatia run on a worker-management model, has ceased production after its electricity was cut off in April. Workers have been without pay for over six months.
After months of agony without electricity and production, the Commercial Court in Varaždin opened bankruptcy proceedings on July 31, 2026, over the Ivanec tool factory ITAS-Prvomajska. This was the last Croatian factory operating under the worker-management model.
Bankruptcy trustee Damir Katić held a meeting on August 11 with workers and former director Dragutin Varga. At the time of the bankruptcy filing, the company had recorded unfulfilled obligations of 1.5 million euros, and the hearing to examine creditors' claims is scheduled for November 24, 2026.
Production at the plant in Ivanec was halted in early April when the factory's electricity was cut off. Among the creditors in the bankruptcy proceedings are about 60 workers, but the bankruptcy trustee warns that the exact number is questionable because some have since resigned on their own.
"As difficult as bankruptcy is for everyone, it is in everyone's interest to do it as well as possible, to protect the rights that can be protected. There has been no electricity since April, and the question now is how many workers there are. The number of around 60 is being bandied about; some have resigned, some haven't," said bankruptcy trustee Damir Katić.
Former worker Vladimir Eršetić described the difficult situation of the employees for HRT: "The situation for us is certainly unfavorable; neither bankruptcy is a good option, nor is the fact that our director was looking for a buyer, but that got prolonged, and people have been without income for six, seven, or eight months."
Despite the bankruptcy, former director Dragutin Varga is not giving up on trying to save the factory. He claims he has found a foreign investor willing to invest 2.2 million euros to restart production. If no agreement is reached, the remaining workers will be laid off, and they will have to collect their back pay and other claims exclusively through the bankruptcy proceedings.
"For me, who has the most seniority in the company, 48 years, it is not a matter of indifference that production be shut down. As director, I will certainly take all measures within my power to keep the company going and to halt the bankruptcy," Varga said.
