Indebted Croatian food group Agrokor said a 150 million euro ($159.33 million) liquidity boost expected within days will help it operate normally for up to 45 days.
Most of it will be used to partially repay local suppliers, Agrokor’s crisis manager Ante Ramljak, appointed by the government, told reporters on Tuesday.
Agrokor, Croatia’s largest private company and the biggest employer in the Balkan region, handed control to the state under an emergency law last week after almost collapsing under debt. “I expect we will complete documentation for the loan by Wednesday,” Ramljak said. “Thus we will secure liquidity for the next 30 to 45 days as our companies, which have continued to operate, also produce liquid funds.”
At the same time, the company will negotiate another 300 million euro liquidity boost, he said.
“Thus we would secure funds for the next nine months and it would give us time to focus on restructuring efforts,” Ramljak said.
Six banks, including Agrokor’s biggest creditors Russian lenders Sberbank and VTB, said on Monday they would provide a quick initial cash injection of 150 million euros.
Agrokor, which employs around 60,000 people in the Balkan region, piled up debts during a rapid expansion, notably in Croatia, Slovenia, Bosnia and Serbia. It owns several retail chains and a number of food producing firms.
Its debts totalled around 45 billion kuna ($6.43 billion), or six times its equity, according to data from last September, although sources familiar with the situation believe debt has risen further in the last six months.
Ramljak said he would invite three or four international consultancies for talks on a restructuring plan in the next few days before deciding on one to take on the task.
($1 = 0.9414 euros) ($1 = 6.9983 kuna)
By Igor Ilic
Source: Reuters
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