Representatives of Kraš were at Karolina, a company owned by the German Lorenz, for a due diligence review of the business, and negotiations with lawyers are now underway regarding the details of the contract. Kraš confirmed its interest back in 2008, but could not agree on a price with the owner. However, the price that Lorenz is asking for, although still unknown, is reportedly lower, thus increasing the prospects for the acquisition.
The largest domestic confectioner Kraš is in advanced negotiations to acquire Osijek’s Karolina, owned by the German Lorenz, as we have learned from well-informed sources close to the management of Karolina. Kraš’s representatives were at Karolina for a due diligence review of the business, and negotiations with lawyers are now underway regarding the details of the contract. However, this does not mean that the acquisition will be finalized, as Kraš has been mentioned several times in this context, and in 2008 officially confirmed its interest, but the potential buyer and the owner ultimately could not agree on a price. However, the price that Lorenz is asking for, although still unknown, is reportedly lower, thus increasing the prospects for the acquisition. We have not received any response from Lorenz and Karolina, and Kraš’s attorney Marica Vidaković stated that she cannot comment on such business moves through the media.
– “Anyone who is considering further development and expansion analyzes potential targets, but we are not at the stage of making a non-binding offer yet,” says Vidaković.
Lorenz’s desire to sell Karolina is not new, as this has been discussed since he took over in 2006 from Luka Rajić. Potential buyers mentioned so far include Bjelovar’s Koestlin and Serbia’s Crvenka and Delta. Rajić, in fact, bought Osijek’s Sloboda in 2002, changed its name to Lura-keksi, then in 2005 to Karolina, and at the end of that year sold it to Lorenz Bahlsen for 22.4 million euros. The current price that Lorenz could get for Karolina is certainly lower, as the Osijek confectioner has accumulated losses since it became part of the German group until this year and has not particularly invested, which has affected the market position of Karolina’s brands. Last year, distribution was handed over to Atlantic Trade, and the business year ended with a profit of 4.3 million kuna (compared to a loss of 10 million kuna in 2008) and an EBITDA of 17.5 million kuna. Expenses were reduced by 42 million kuna, while revenue fell by 26 to a total of 135 million kuna at the end of 2009. Industry experts believe this is a sign that Lorenz has seriously begun to ‘groom’ Karolina for sale, considering that despite engaging a foreign company for mediation in the sale of the company more than a year ago, they have not yet found a buyer.
