PM says all objectives of Agrokor emergency administration achieved

The process of emergency administration in Agrokor has succeeded and all of its goals have been achieved, Prime Minister Andrej Plenkovic said on Wednesday after meeting members of the Fortenova Group's management board, led by board chair Maxim Poletaev.

The Agrokor Group started operating under the new name Fortenova on 1 April.

The process of emergency administration in Agrokor was implemented in "a really short period of time" and "efficiently, quickly, safely and successfully," said the PM.

He added that the main goals of the process - the continuation of the company's operations, the preservation of jobs and protection of suppliers' interests, the repayment of the largest possible portion of the old and so-called borderline debt, the settlement of almost all debts to family-owned farms and the maintenance of macroeconomic and political stability - had been accomplished.

Plenkovic noted that "there are few examples of such large-scale overhauls that have accomplished their goals in such a short period of time."

He stressed that the entire process had been carried out without any costs for taxpayers or the state budget and that proof of that was Croatia's exit from the Excessive Deficit Procedure and the Excessive Macroeconomic Imbalances procedure as well as the recent decision by Standard & Poor's to put back Croatia's rating in the investment category, after six and a half years.

"We now expect the process of consolidation and improvement of business operations to continue with the new management and the new owners, and the government is willing to support it," said the PM.

He said that the legal validity of the emergency administration procedure had been confirmed by the Constitutional Court, which had ruled that the law on emergency administration in strategically important companies was in line with the constitution and that it had also been included in EU regulations on insolvency procedures.

Noting that in the process the government had maintained political stability, Plenkovic thanked emergency administrator Fabris Perusko and his deputy Irena Weber as well as former emergency administrator Ante Ramljak, and especially former economy minister Martina Dalic.

"We want the new company, Fortenova, to operate well in Croatia and elsewhere in this region and to focus on consolidating its main business segments - agriculture, food industry and retail and wholesale business," said Plenkovic.

He noted that the roll-up loan taken by the company should be rescheduled in a short period of time, under terms acceptable to the company.

The loan, amounting to EUR 1.06 billion and taken to settle Agrokor's debts, has an interest rate of 11.5%, which is expected to increase to 14% by September, while the effective interest rate is expected to be 18%.

"We have made it clear that in the company's future operations we expect an adequate status for Croatian suppliers and the Croatian farming sector and that the group will operate to the benefit of the Croatian economy," Plenkovic said.

Poletaev: Focus on future, no investigation; PM: Another piece of fake news

Fortenova Group Management Board chair Maxim Poletaev thanked Agrokor's customers, employees and the Croatian government for support in the process of emergency administration and the emergency administration itself.

Commending the work of the emergency administration, he said that he had not seen a case in which a solution to the problem would be found as quickly as it had been found in the case of Agrokor.

As for Fortenova's biggest shareholder, Sberbank, he said that it was interested in medium-term operations and that together with other owners it wanted to increase the company's value.

Now is not a good time to sell stakes in the group, Poletaev said, adding that Fortenova's having been organised in three core segments was a good model and that it would be possible to increase its value better if the group was whole.

He said the new management would focus on the future and not the past, which, he said, he did not want to investigate but rather wanted to become acquainted with what had been inherited.

Asked if it was true that a team would be set up to analyse decisions made by Ramljak and Dalic, Poletaev said that that was not true, that Sberbank was not an investigating body and that the public paid to much attention to such rumours.

PM Plenkovic said that this was yet another piece of fake news.

Underlining the importance of rescheduling the roll-up loan, Poletaev said that he believed a solution could be found by the middle of the summer.

Answering reporters' questions, Agriculture Minister Tomislav Tolusic said that the farmland previously leased to Agrokor for cultivation would continue to be cultivated by mirror companies established in the process of emergency administration.

The emergency administrator for Agrokor, Fabris Perusko, said that the emergency administration was important not only for Croatia but also for the entire region, that the company had been brought back to life and that it was now doing business successfully.

He announced the completion of the implementation of settlement procedures outside Croatia, which, he said, would take several months, as well as the rescheduling of the super-senior debt and work on increasing profitability.

Text: Hina

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