Trading of SN Holding shares suspended

The Croatian Financial Services Supervisory Agency (HANFA) today ordered the Zagreb Stock Exchange to temporarily suspend trading of SN Holding shares due to a 10 percent increase in their price and considering rumors about reaching an agreement regarding disputes between SN Holding and the Croatian Privatization Fund (HFP) concerning shares of Liburnia Riviera Hotels (LRH).

This week (May 4), HANFA also ordered the Stock Exchange to temporarily suspend trading of LRH shares until May 7 (including that date). For the suspension of trading of SN Holding shares, HANFA indicated in its decision that it will last until evidence is provided that will determine the cessation of that measure. HANFA has requested statements from LRH, the City of Opatija, the Croatian Privatization Fund (HFP), and SN Holding regarding the possible existence of privileged information related to LRH.

In their statements published on the Zagreb Stock Exchange, the City of Opatija and LRH stated that they have no privileged or other knowledge regarding negotiations between SN Holding and HFP, but that they are aware of the rumors through the media. SN Holding noted in its statement that the existence of a dispute between them and HFP regarding LRH shares is a ‘notorious fact’ and that they are making ‘every possible effort’ to resolve this dispute as soon as possible. They added that they proposed a settlement to HFP and that HFP accepted it.

Negotiations regarding the conclusion of this settlement are ongoing, but their outcome and duration cannot be predicted, as not only must the text of the settlement be agreed upon, but other prescribed procedures must also be carried out, SN Holding added. HFP confirmed in its statement to the Stock Exchange that SN Holding submitted a proposal for the peaceful resolution of the dispute and that the HFP Management Board accepted the information about the received settlement proposal on March 25 of this year. Consequently, it obligated and authorized the professional services of HFP to enter into negotiations with SN Holding to resolve all mutual legal disputes.

To date, no detailed information has been available regarding this settlement proposal from either SN Holding or HFP, with both parties always noting that negotiations take time and that everything will be known when they are completed. The key issue in all of this is whether and in what exact manner SN Holding will become the majority owner of LRH, or how the state/HFP will arrange ownership of nearly 59 percent of the shares in LRH, which are currently officially held by HFP. The controlling stake of 25 percent of shares in LRH is held by the City of Opatija through its company Nova Liburnija d.o.o. (H)