Indebted Croatia's food concern signs standstill agreement


Indebted Croatian food and retail group Agrokor has signed a standstill agreement with creditors in an effort to stabilise its business, the company's spokeswoman said on Sunday.

On Friday a group of creditors including two top Russian banks and the Croatian arms of Austrian and Italian lenders, said that they had agreed with Agrokor in principle on the main elements of a standstill agreement.

“Agrokor has signed the agreement,” the spokeswoman said but declined to go into details.

Agrokor, the largest private firm in Croatia and the biggest employer in the Balkans with around 60,000 workers, built up debts of about 45 billion kuna ($6.44 billion), or six times its equity in the course of its regional expansion.

The agreement is expected to include a cash injection and new management tasked with restructuring the business. Analysts believe the company, whose operations are focused on Croatia, Slovenia, Serbia and Bosnia, will have to sell off some operations.

Croatian Prime Minister Andrej Plenkovic is set to meet Agrokor's local suppliers for talks on Monday. Debts to suppliers alone have been estimated to be some 16 billion kuna, according to media reports.