Croatia’s troubled food and retail conglomerate Agrokor has closed two of its flagship stores, and it may be looking to sell its retail operations in Bosnia and Herzegovina.
As part of a restructuring process aimed at averting the bankruptcy of Croatia’s biggest retailer, Agrokor has closed dozens of Konzum supermarkets in Croatia over the past six months, mainly the neighbourhood-store format. Last June, the CEO of Konzum, Slavko Ledic, announced that the retailer planned to close between 80 and 100 stores in total.
Since the start of 2018, the company has also shuttered two large Konzum supermarkets, in Rijeka and Osijek, reports T-Portal. The Rijeka store, which closed on 31 December, was the retailer’s largest point of sale in Croatia, at 5,000 square metres in size.
Agrokor's administration claims that the stores in Rijeka and Osijek were loss-making and did not have future business prospects. In a statement to T-Portal, the company pointed out that the closures are part of its larger sales-network optimisation plans.
“As part of the restructuring process, focus has been placed on increasing the efficiency and profitability of each part of the company while preserving jobs, all with a view to achieving long-term, sustainable business," Agrokor said, adding that all employees of the two closed stores have been given jobs in nearby Konzum stores.
Potential Takeover
Meanwhile, Slovenian daily Dnevnik has reported that there is significant interest in the acquisition of Agrokor’s grocery-retail operations in Bosnia and Herzegovina, which are managed by Slovenian subsidiary Mercator.
According to unnamed sources, local grocery retailer Bingo, as well as Arab and Serbian investors, are allegedly interested in buying Mercator. They add that the management team of Agrokor, headed by Ante Ramljak, is reportedly open to the possible sale of the Bosnian unit for a reasonable price.
The market value of Mercator in Bosnia and Herzegovina is not known, but the latest publicly available data from the end of September 2017 reveals that the net financial debt of the Mercator Group amounted to over €794 million.
Mercator returned to Bosnia and Herzegovina last October, as part of a rebranding operation that saw 83 stores updated from Konzum to Mercator.
In neighbouring Serbia, Agrokor recently sold the Mercator Shopping Mall in New Belgrade for €46 million. It was acquired by a local consortium headed by MPC Group, which is owned by Serbian businessman Petar Matić.
The deal, which does not include the retail operations, but only the real-estate assets, is aimed at reducing the company's obligations towards the banks.
© 2018 European Supermarket Magazine – your source for the latest retail news. Article by Branislav Pekic. Click subscribe to sign up to ESM: The European Supermarket Magazine.
