RETAIL: Agrokor Signs €600 Million Loan with Russian Sberbank; Mercator Acquisition Nears Completion

31 March 2014, LPJ Croatia Issue 78

todoricOn 24 March, Croatia’s largest food producer and retailer Agrokor announced it had signed a €600 million loan with the Russian Sberbank and its subsidiary Sberbank Europe AG.  The loan was officially signed on 14 March.  The repayment period is seven years.  In separate exchange filings, Agrokor’s business units – meat processing company PIK Vrbovec, ice cream producer Ledo, producer of mineral and spring waters Jamnica, and food producer Zvijezda – stated that they were among the guarantors of the above loan.

Regardless of Agrokor’s decision not to comment on the purpose of this borrowing, it is evident that the company will use the financing to complete the acquisition of Slovenia’s largest retailer Mercator.  This transaction also represents the biggest influx of Russian capital into the largest privately-own company in Croatia.

During this same period, Austria-based Sberbank Europe AG announced the signing of its first syndicated term loan facility, valued at €350 million, to support business development in Central Eastern Europe.  The syndicated loan will be provided by Societe Generale, Bank of America, Barclays, Citi, HSBC, ING Bank, J.P. Morgan, Mizuho, Sumitomo Mitsui, and UniCredit Austria.

In June 2013, after a long negotiation process lasting several years, Agrokor signed a purchase contract with Mercator’s ownership consortium…

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