Italy's Palladio Finanziaria to acquire major Slovenian exporter Cimos by September 9

By bne IntelliNews July 14, 2016

Major shareholders of Slovenian automotive components manufacturer Cimos Group accepted a binding bid from Italian investment fund Palladio Finanziaria for their 92.3% stake in the company on July 13, Bank Asset Management Company (BAMC), the largest single Cimos shareholder and the leader of the shareholder consortium, announced on its website.

Cimos has been a leading Slovenian exporter for decades, and is one of the 15 state controlled companies earmarked for privatisation by the government in June 2013 as part of its efforts to strengthen the country’s economic recovery after the eurozone crisis. The company was brought back from the brink of bankruptcy in a €169mn debt-to-equity conversion last year, which brought it under majority state ownership.

According to BAMC, as the Palladio Finanziaria bid was accepted, the next step will be exclusive negotiations, within the framework of which it will complete the final activities necessary for the signature of the Share Purchase Agreement (SPA) on September 9 at the latest. Key milestones until then are drafting the SPA, which is due to be prepared and accepted by August 4, as well as the commitment with all bilateral banks by September 2.

BAMC has not yet provided any details about the value of the deal.

According to earlier media reports, besides Palladio Finanziaria, Bosnian businessman Nijaz Hastor also submitted a non-binding bid for Cimos. Hastor, best known in Slovenia for his role in the bankruptcy of former flagship car seat cover maker Prevent, unofficially offered €200mn, RTV SLO reported on March 24. According to RTV SLO, Palladio Finanziaria was interested only in Cimos' assets in Slovenia, Bosnia and Serbia, but not Croatia.

The company was put up for sale in August 2015, but received fewer bids than expected, local media in Slovenia reported, adding that negotiations with the bidders were conducted in strict confidentiality in recent months.

The stake in Cimos is being sold by the BAMC (47.5%) and Slovenian Sovereign Holding on behalf of the state (24.26%), and banks NLB (9.44%), Gorenjska banka (5.74%), Abanka Vipa (2.42%), NKBM (2.2%) and SID banka (0.74%).

Cimos is based in the coastal town of Koper in southwestern Slovenia, and employs around 2,000 people. One of the biggest industrial groups in the country, it is undergoing operational restructuring.

In the first nine months of 2015, the Cimos group generated €252.7mn in revenues, while cutting costs by 10% compared to the same period of 2014 and improving liquidity.

BAMC said in its July 13 press release that Palladio Finanziaria has long track record of successful restructuring of automotive industry companies.

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