PETROCHEMICALS: Crodux Oil & Gas Acquiring Petrochemicals Dioki Group

A new plan for the restructuring of the petrochemical Dioki Group was sent this week to the Financial Agency (FINA) for its formal approval. The main goal of the plan is to transform Dioki into a stable and sustainable business by 2017. It includes the transfer of the majority of the company’s shares (55%) to the company Crodux, owned by retired Army General Ivan Cermak, with minority shares to Zagrebacka Bank (ZABA) and the state-owned Croatian Electra (HEP).

The  Dioki receivership Board drafted the plan in accordance with Cermak’s acquisition proposal. . The Board partially agreed to his terms; however, it did not accept his request for a complete write-off of state claims, because it was not in accordance with Croatian law. According to the above-mentioned plan, Crodux will provide €11 million of operational assets for Dioki (Zagreb plant) and Dina (Krk island plant).Zagrebacka Bank will convert €9.4 million of its claims, acquiring 15.35% shares; while HEP will convert €11.3 million into 15.35% shares. Furthermore, one of the key creditors Adriaoila from Milan (Italy) has 81% stake in the company Cuf (the remaining shares owned by Dina Petrochemicals, a part of Dioki Group). Since Adriaoila is in the process of liquidation, the plan provides for assigning its financial obligations in the amount of €24.6 million to Dina and Dioki.  This will allow Dioki  to take over Cuf, which is significant because Cuf’s shares would subsequently be sold to HEP for €24.6 million and allow HEP to acquire the vital piece of property necessary for the construction of LNG Terminal Project on the Island of Krk in northern Adriatic Sea.

This restructuring plan will ensure that HEP acquires the property for the LNG Project, which is one of the prerequisites for the realization of the project.  Along with Crodux’s recent acquisition of the Austrian OMV network of petrol stations in Croatia (see news below), Cermak is expanding his business operations and becoming a regional competitor in the field of oil & gas distribution and petrochemical production and exports…

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