Agrokor, one of Croatia’s largest companies, recently had its credit rating downgraded.
Finance Minister Zdravko Marić said on Thursday that he was familiar with the situation in Agrokor and added that he did not believe that the company would go bankrupt, since it is still a good company, reports Poslovni.hr on January 26, 2017.
Asked before the start of today’s cabinet meeting whether he was familiar with the situation in Agrokor and if there was a possibility that the company might go bankrupt, which would represent a great danger for the Croatian economy given the size and importance of the whole group, Marić said that he would not go so far as to start discussing bankruptcy and added that he was familiar with the situation in Agrokor, a company in which he worked prior to becoming Finance Minister in January last year.
“Over the past year, I have been following Agrokor as a minister just like I follow any other company. As far as the current situation is concerned, I think that the company itself issued a statement yesterday in which it clearly indicated that there were no risks with regards to its financial obligations in the foreseeable future. However, it is certain that the downgrade of its credit rating had certain repercussions”, said Marić.
Asked whether there was a plan “B” in the event that such a big company goes downhill, Marić said that his opinion was that the company was still in a good condition and that something like that would not happen.
The Moody’s rating agency announced on 2 January that it had downgraded Agrokor’s credit rating from B2 to B3, with a stable outlook. “This downgrade reflects our opinion that Agrokor will not be able to retain credit ratios in line with our previous requirements for B2 rating, in light of the deterioration in operating performance that occurred during the first nine months of 2016”, said Vincent Gusdorf, vice president and analyst at Moody’s. He added, however, that the stable outlook reflected expectations that Agrokor would stabilize its earnings in the next 12 months despite fierce competition in Croatia and Slovenia.
Agrokor is the largest private company in Croatia and one of the largest companies in Southeast Europe, with annual revenues of more than 54 billion kuna. Agrokor employs tens of thousands of employees, and its owner and CEO is Ivica Todorić, widely considered to be the richest Croat. Agrokor Group includes some of the best-known Croatian brands, including the largest Croatian producer of mineral and spring water Jamnica, Ledo ice cream, Zvijezda oil, margarine and mayonnaise, the largest Croatian meat industry PIK Vrbovec, the largest agro-industrial company in Croatia Belje, the leading retail chain Konzum, and the leading Croatian chain of newsagents Tisak. It also has considerable interests in neighbouring countries as well.
