May 15, 2018 / 8:56 AM / in 2 months

Agrokor to put settlement text to creditors next week

ZAGREB (Reuters) - Indebted Croatian food group Agrokor [AGROK.UL] is finalizing a settlement text that it plans to put to creditors next week, the company’s crisis manager Fabris Perusko said on Tuesday.

FILE PHOTO: Agrokor crisis manager Fabris Perusko attends a news conference in a government building in Zagreb, Croatia, April 10, 2018. REUTERS/Antonio Bronic/File Photo

Food producer and retailer Agrokor, the largest company in the Balkans with some 60,000 staff, was put under state-run administration in April 2017, crippled by debts built up during an ambitious expansion drive.

Creditors agreed draft settlement terms last month, which Perusko is now working to finalize.

“At the moment a big problem we are working on are some claims that are disputed for tactical reasons as it slows down the process,” said Perusko.

Some local firms, such as coffee and tea producer Franck, insurer Agram and tourism and insurance group Adris, have voiced discontent over the settlement process, potentially seeking to improve their negotiating positions.

The settlement must be voted on by July 10, according to an emergency law adopted a year ago to save Agrokor from bankruptcy.

Agrokor said a vast majority of creditors were behind efforts to finalize the deal. For the settlement to be valid two thirds of the creditors, which include foreign and local banks, bondholders and suppliers, must vote for it.

The biggest single creditor of Agrokor is Russia’s Sberbank with loans worth 1.1 billion euros ($1.3 billion). Sberbank is set to become the biggest single shareholder in the new company after the settlement which will also include a certain level of write-offs.

Reporting by Igor Ilic; Editing by Mark Potter

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