Slovenian retailer Mercator, owned by Croatia’s Fortenova, has abandoned its bid to acquire Engrotuš (Tuš stores), news agency STA has reported.
The inability to secure regulatory approval within the one-year exclusivity period led to Mercator’s withdrawal, according to the report.
Engrotuš’s owners, however, remain committed to the company’s long-term success and will seek alternative buyers.
‘The partners of Engrotuš remain committed to the long-term development and successful operation of the company, and, at the same time, further activities will also be aimed at finding the possibility of selling the company to more serious buyers,’ Tuš Holding announced in a statement.
Last November, Mercator agreed to buy 100% of Engrotuš, excluding its separate pharmacy operations, for an estimated €30 million.
Both companies expected the merger to boost future growth and ensure long-term viability. Also in the running for Engrotuš was German supermarket chain REWE.
Regulatory Approval
Mercator’s application for regulatory approval from the Slovenian Competition Protection Agency was passed to the European Commission and then returned.
Despite resubmitting the application in late August, Fortenova Group still did not receive approval, while the contract’s one-year exclusivity period had expired.
According to Andraž Tuš, director of Tuš Holding, the sellers met all their obligations, but Mercator’s failure to secure competition clearance resulted in the buyer withdrawing from the deal, rather than seeking an extension.
Meanwhile, Tuš Holding expressed concern that Mercator, during the due-diligence process, gained access to sensitive business information that could now be used to compete unfairly with Engrotuš.
It stated that it will monitor Mercator’s actions and take protective legal measures if necessary.
Mercator, Slovenia’s largest grocer, controls about 25% of the market, with approximately 460 stores, while Engrotuš, the fifth-largest retailer, holds a 10% share and operates around 260 Tuš stores.
