The process of reaching a settlement under the extraordinary administration procedure of Agrokor is one of the most complex in Croatia and in Europe due to the complexities of Agrokor as a business and the total amount of the debt as well as the large number of creditors, 5.700 of them. This section contains all the news on the process of reaching of a settlement for all the key stakeholders, as well as the latest details and developments.
All Business Sectors of Agrokor Record Growing Revenue and Profits
12. Mar 2019.
Agrokor Group to Become Fortenova Group as of 1 April 2019
The Extraordinary Administration’s monthly report related to the period from 11 February to 10 March 2019 was published today, providing an update of the economic and financial situation in the Agrokor Group and reporting on the operating activities of the Extraordinary Administration as well as the overall business operations of Agrokor d.d. and some of its major companies.
The report comprises the results of 16 companies from three business segments: Retail and Wholesale, Food and Agriculture, which in the period under review generated HRK 1,5bn in revenues and HRK 34.2m in operating profits. All business sectors have recorded an increase both in revenues and EBITDA.
The Food sector generated a 1.9% growth of revenues to HRK 443m and 19.8% growth of EBITDA to HRK 14.7m. Worth to be singled out are the business results of Zvijezda d.d. with HRK 48m in revenue, outperforming the budget by HRK 3m, while EBITDA exceeded the budgeted value almost three times.
The Retail and Wholesale sector saw an increase in revenues of 0.6% compared to the budget with HRK 905m generated in January 2019. Within the scope of this sector, worth to be highlighted are the operating results of Konzum d.d. with revenue outperforming the budget by 2% and EBITDA exceeding the planned value by HRK 24m.
In the Agriculture sector revenue outperformed the budget by 34% and amounted to HRK 192m due to higher revenues in the segment of cereal and oil crop sales. At the same time EBITDA was 61.1% higher than budgeted due to the increase in cereal and oil crop prices and synergic savings made in raw material and production material costs.
At the session held on 28 February 2019 the Interim Creditors’ Council of Agrokor, in consent with Agrokor’s Extraordinary Commissioner, decided to request from the Commercial Court of Zagreb to set 1 March 2019 as the Public Announcement Date of the Settlement Plan implementation, to determine the Implementation Commencement Date to be 1 April 2019 and to approve the public announcement of the Implementation Commencement Date through the website Courts’ e-Bulletin Board at the Public Announcement Date.
Pursuant to the decree of the Commercial Court of Zagreb dated 1 March 2019 (business No. St-1138/17) and to Clause 17.1 of the Settlement Plan, the Extraordinary Commissioner of the debtor Agrokor d.d. declares 1 April 2019 as the Settlement Plan Implementation Commencement Date, as at which the restructuring measures and implementation activities set forth by the Settlement Plan will be materialized. According to the above approval of the Commercial Court of Zagreb, as of 1 April 2019 the transfer of the economic entity under the Extraordinary Administration from Agrokor to Fortenova Group will take place, with the new company thus becoming operational.
Out of the total of 159 companies operating within the Agrokor Group, 77 companies under Extraordinary Administration in the Republic of Croatia will be the first to go through the Settlement Plan implementation. Out of that, 45 insolvent companies will be mirrored and the new „plus“ companies will start their operations within the new group. At the same time the old, non-viable companies enter the process of being amalgamated to Agrokor d.d. Once all the assets and companies are merged, the end of the Extraordinary Administration Procedure will be established and Agrokor deleted from the Court Register. The stakes of 32 solvent companies in Croatia will be transferred to the New Group and once the stakes are transferred, the companies exit the Extraordinary Administration Procedure. The stakes of 82 companies outside Croatia which are not subject to the Extraordinary Administration shall be transferred to the new group together with the other assets and the transfers shall be recorded pursuant to the respective laws of the relevant jurisdictions, as soon and as cost efficiently as possible.
Fortenova Group is the new name of the parent company to replace Agrokor d.d., scheduled to become operational on 1 April 2019. Fortenova Group is a joint stock company the corporate governance structure of which shall be comprised of a Board of Directors and Executive Directors. The Board of Directors counts nine members who will hold regular sessions and engage in strategic matters of running the company and other matters falling under their competence by the law and the company’s Articles of Association. The candidates proposed by the shareholders as non-executive members of the Board of Directors are: Daniel Boehi, Miodrag Borojević, Paul Foley, Kelly Griffith, Maksim Poletaev, Julian Michael Simmonds and Sergei Volk. Yet another non-executive member of the Board of Directors will be a workers’ representative, to be elected by the employees of the new company. Fabris Peruško is candidate for the executive member of the Board of Directors.
Fabris Peruško has also been proposed as Chief Executive Officer of Fortenova Group and Irena Weber as Deputy CEO and Chief Operating Officer. Yet another executive director will be proposed subsequently, with the company’s operations hence to be managed be three executive directors in total.