The Slovenia Times

Mercator to become part of Fortenova Grupa by end of year


Peruško has been responsible for the winding down of Agrokor since February 2018, he will also head the new Fortenova Grupa which will be launched on 1 April to bring under one hat Agrokor's successful subsidiaries.

Meanwhile, the insolvent companies will remain part of Agrokor. The process of transformation will start with Agrokor's companies in Croatia, while those based in other countries will be included once the process is completed in Croatia.

On 1 April, 32 solvent Croatian companies will become part of the new group, while the 45 Croatia-based insolvent companies, which will remain part of Agrokor, will each get their own "mirror company", which will also be included in the Fortenova Grupa.

The names of the new companies will be made up using their original names and the word plus, said Peruško.

The third group of companies includes Croatia-based companies in which Agrokor holds less than 25% and 82 Agrokor companies based in Slovenia, Serbia and Bosnia-Herzegovina.

"Mercator is in the third group and we want a speedy transfer of assets from the company in receivership, Agrokor, to the more health company, Fortenova. This is also important for Mercator's suppliers, employees and the entire Slovenian economy."

Peruško expressed satisfaction with "fair relations" between Agrokor and Slovenia's Economic Development and Technology Minister Zdravko Počivalšek, as well as with Gregor Planteu, a government-appointed member of Mercator's board.

He believes that it would be advantageous if Planteu remained on the board of Mercator also after the retailer becomes a part of Fortenova Grupa. The transfer of Mercator to Fortenova does have its own dynamics which depends on the Slovenian legislation.

"Certain small Slovenian banks have reservations about the transfer but I believe that the plan contains rational economic arguments and that it must be green-lit as soon as possible because this is in the interest of the banks."

"If the banks fail to support the transfer, Mercator will remain a part of a company that has gone bankrupt. This is in nobody's interest," Peruško said when asked about the potential scenarios for Mercator's future.

The most imminent steps for the plan to be implemented is to get the go-ahead of the Slovenian competition watchdog and resolve issues involving minority shareholders, both of which Peruško sees as mere formalities, which do, however, take a certain amount of time.

When asked whether Mercator could become one of the leading companies of Fortenova Grupa, Peruško said that Mercator, as well as Croatian retailer Konzum, must be viewed in the scope of the group's entire retail division.

Both companies are facing challenges in different markets of the region. Their operations must be optimised to the benefit of the entire group. Peruško underlined that synergies of the two groups must finally become reality.

Peruško, who was not involved in Agrokor's takeover of Mercator in 2014, believes that the Croatian group paid a lot for Mercator. He also said that Mercator was in better condition now than it was before the takeover.

"When it was taken over by overindebted Agrokor, Mercator was not a healthy company and Agrokor provided a much-needed injection that helped it survive."

"The problems started when they failed to build a platform that would make them healthy partners for their suppliers." Peruško said that Fortenova Grupa would abolish certain limitations to allow better partnerships with suppliers.

The Agrokor boss believes that the Slovenian market is too small for Mercator. "I see Fortenova Grupa as a new and healthy platform on which Slovenian suppliers will be able to develop their business."

Fortenova Grupa will start out with a lot of debt: between EUR 1.4bn and EUR 1.5bn. The group expects to generate between EUR 320m and EUR 340m in operating profit. It will moreover sell off business operations that are not a part of its core divisions: retail, food production and agriculture.


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