Croatia’s Fortenova probes interest in sale of agricultural business

Croatia’s Fortenova probes interest in sale of agricultural business
The grain harvest at Belje, part of Fortenova Group. / Belje
By bne IntelliNews January 30, 2024

Croatia's Fortenova Group said on January 30 it is probing investors’ interest in the sale of its agricultural business division, sending a teaser to several possibly interested buyers as part of its restructuring plan.

Fortenova was formed from the restructuring of Agrokor, following a settlement with creditors of the troubled group. With operations in food production, retail and agriculture employing more than 45,000 people, it is the largest private employer in the Southeast Europe region.

“By the end of the first quarter, Fortenova Group anticipates receiving non-binding offers from potential buyers, after which a decision will be made regarding the continuation of the potential sale process,” the company said in a press release on its website.

It added that it would only sale the agricultural business if it receives from potential strategic partners and will be focused on those willing to not only offer a fair price, but also “make a maximum contribution to the further development and preservation of employment and the tradition of agricultural production in Croatia”.

Over the past years, Fortenova invested in the modernisation of its agricultural division with investments in 2023 alone reaching €60mn for renewal of agricultural machinery.

Among the group’s assets in the agricultural sector are agriculture and processing company Belje, PIK Vinkovci, which is primarily involved in arable farming, and Vupik, which has a focus on pig breeding as well as being active in other agricultural segments. 

“Should the sale be realised, the proceeds from the sale would be used to further reduce Fortenova Group’s indebtedness as well as for strategic investments in other core business areas, such as retail and food,” the company noted.

Previously, Fortenova sold off its Frozen Food Business Group, which included the popular Ledo and Frikom brands, in a €615mn deal in 2021.

Restructuring continues 

In 2023, depositary receipt holders of Fortenova Group approved a deal worth up to €660mn under which shares owned by sanctioned Russian banks were to be acquired by Malta-registered Open Pass Limited.

Fortenova shareholders agreed that Open Pass, controlled by local tycoon Pavao Vujnovac, would pay off sanction-hit Russian banks, VTB and Sberbank, that were among the owners of the group.

That allowed Vujnovac to significantly increase his stake in Fortenova; though his exact holding is unclear the deal was seen as paving the way for him to become the majority owner of Fortenova.

However, the deal proved controversial earlier in January, Fortenova’s CEO Fabris Perusko was accused by the conservative populist Most party of acting against the company’s interest in favour of Vujnovac, allowing him to take over Fortenova.

Fortenova has responded, accusing Most’s MPs of repeating accusations by sanctioned Russian stakeholder SBK Art and by the lawyer of UAE investor Saif Alketbi, whose legal battle to take control of Fortenova failed.