Petrol takes over Croatia’s Crodux

Ljubljana – Slovenia’s energy company Petrol has taken over an outright stake in Croatian petroleum products seller Crodux as a result of which Petrol will acquire 91 service stations in Croatia once the deal has been cleared by regulators.

Petrol said the deal was signed on 12 January with Ivan Čermak, the owner of Crodux. The transaction will be completed following the fulfilment of suspensive conditions, which include obtaining approvals from the relevant competition authorities.

The takeover will increase Petrol’s market share in Croatia from 13% to 23%. It will thus operate more than 200 points of sale in Croatia and a total of 601 in South East Europe.

Petrol described the acquisition as its largest transaction in a decade and the “most significant one-time increase in the number of points of sale in the group’s history”.

Employing 1,150 people, Crodux posted EUR 19.3 million in net profit in 2019 on EUR 760 million in sales revenue. Its core business is import, storage, retail sale and wholesale of petroleum products in Croatia.

“In Croatia, Crodux is recognised as a reliable business partner and supplier of high-quality motor fuels as well as a seller offering a wide range of merchandise, and hospitality and other services,” reads a press release from Petrol.

Petrol said the acquisition would allow it to boost its presence in certain key parts of Croatia where it has had weaker presence or has not had points of sale so far.

“The volume of operations in Croatia will allow for the successful business model, as established in Slovenia, to be transferred also to this market,” the release reads.

It added that there was still potential to increase sales of petroleum products and merchandise, which account for the largest part of the group’s EBITDA, in the coming years, especially in the broader SE Europe region.

It said the acquisition was consistent with the existing strategy as well as with the basis for developing a new strategy of the group and expansion plans.

“The decision was also taken in the light of the fact that the Croatian market is closest to the Slovene market in terms of economic development, maturity of the petroleum product market, purchasing power and cultural features.”

The value of the deal was not disclosed. The newspaper Finance has reported that the company was priced at EUR 200 million in the past, but Crodux at the time said the figure was undervalued. Unofficial information available to the paper indicates that Petrol managed to reduce the agreed price somewhat last year due to the impact the coronavirus pandemic had on Crodux.

Petrol pledged to continue to follow the European Commission’s guidelines for a green post-pandemic recovery, pursuing its path towards becoming a low carbon company. “Development and innovative solutions require solid, stable foundations, and the acquisition of Crodux helps to ensure this,” they said.