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Sat 1 Aug 2009 10:26 PM

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Iran Khodro $9bn in debt - report

Automaker's reported financial woes come after $1bn gov't rescue package announced on Wednesday.

Iran Khodro $9bn in debt - report
IRAN KHODRO: Automaker now reported to be $9 billion in debt. (Getty Images)

Iran Khodro, the largest automaker in the Mideast, has sunk deeper into the red, reports said on Saturday.

Jamshid Imani, IKCO's Deputy Managing Director, said that the company's debts stood at more than $9 billion, Press TV said, citing the Donya-e-Eqtesad daily.

On Wednesday, Iran's Monetary and Credit Council announced that it had agreed to a $1 billion government-backed rescue package for Iran Khodro.

According to Imani, half of the aid will be available "within days". 

"The rest will be made available after the sale of Iran Khodro's shares through Parsian Bank," he added.

Imani meanwhile blamed former managers of the company for the financial crisis in the ailing automaker.

IKCO Chief Executive Javad Najmeddin also acknowledged that past investments in the company were not profitable.

IKCO's huge debts are now threatening to force it into insolvency, with the possible loss of thousands of jobs.

Iran Khodro's annual shareholders' meeting will probably be held on August 11. Fireworks can be expected.

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