Serbian court rejects Croatia's Lex Agrokor

Serbian court rejects Croatia's Lex Agrokor
By bne IntelliNews September 1, 2017

The Commercial Court in Belgrade has turned down a request by Ante Ramljak, the government-appointed extraordinary commissioner at Croatia’s Agrokor, for companies within the group in Serbia to be placed under the jurisdiction of Lex Agrokor, Jutarnji List reported on August 31. The decision can be appealed.

Lex Agrokor, approved by Croatia's parliament in April, is aimed at equal treatment of the food and retail group’s creditors. Among other provisions, it prevents individual creditors from collecting their debt by selling Agrokor assets. The law is applicable to companies of systemic importance, namely those with liabilities of more than HRK7.5bn that employ more than 5,000 people.

Ramljak said that he was not surprised by the Serbian court’s decision, particularly since Serbia is not part of the European Union.

“We have to examine the decision and we expect we will appeal against it,” Ramljak said.

A similar request was admitted in Slovenia and another one is pending in the UK.

The companies owned by Agrokor group in Serbia include retailer Mercator-S, ice cream maker Frikom, butter producer Dijamant, mineral water bottler MG Mivela and flour mill Kikindski Mlin. Mercator-S alone employs 11,000 people and has 650 suppliers in the country.

During its debt-fuelled expansion, Agrokor accumulated €3.5bn of debts to creditors and €2.2bn debts to suppliers. Agrokor employs 60,000 people in Croatia, Slovenia, Serbia, Bosnia & Herzegovina and Hungary. 

Russia’s Sberbank has already launched procedures in Belgrade courts to recover its loans to companies in the Agrokor group. 

In mid-August, branches of Sberbank in Slovenia and Croatia initiated three enforcement procedures against the bottled water company Jamnica (part of Agrokor group). 

In a second step, Sberbank is seeking foreclosure on the issuer’s shares in Jamnica’s daughter company MG Mivela, which is headquartered in Belgrade and Jamnica mineralna voda d.o.o., based in Slovenia's second largest town Maribor.

 

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