Tatramleko questions decision to shift HQs
giving further thought to to the idea of moving its headquarters to
neighbouring Slovakia in an effort to reduce taxation costs.
At the beginning of the week it was widely reported in national newspapers that the company owner Milan Domacek wanted to move his company's headquarters from Hlinsko to an undisclosed location in Slovakia. Domacek said he believed that the company could make annual savings of CZK110 million (€3.5m), but in the same breath he emphasised that there were no plans to move any of the production facilities.
But speaking to Tatramleko CEO Miroslav Pekar today, CEEFoodIndustry.com discovered a more cautions attitude to Domacek's earlier announcement. "I cannot really make any comment on the decision but I can confirm that the company is definitely contemplating this move," he said. "However, the decision still has to be given the go ahead from the shareholders, so it is some way from being fully approved at this point in time."
Tatramleko is currently enjoying a period of strong growth from increased exports to both Russia, Europe and as far away as Thailand. In 2003 the manufacturer of long-life milk, coffee and flavoured milks, cream toppings and butter announced that it had increased its sales turnover by 9 per cent to CZK2.75 billion. However with this year's accession to the European Union opening up that market, sales are expected to be given a further boost this year.
Questioning officials at the Federation of Czech Food and Drink industries, opinion was that the decision was unusual and that this did not appear to be part of a trend for Czech food companies to relocate to Slovakia in order to save on costs.
"Indeed it seems as though Tatramleko may have jumped the gun on this one," said one of the officials. "Evidently they have recalculated the savings that the company might make if it shifted its headquarters and it seems that they are not as great as first thought."
Clearly the final decision now lies with shareholders, but with cost savings not as great as first thought, it seems like the decision to move the headquarters could be lying in the balance.
