Heilbronn: EBRD monitors ‘rescue of Agrokor’, support for subsidiaries in the region is possible

Vice President of the European Bank for Reconstruction and Development (EBRD) Pierre Heilbronn stated for Ljubljana’s Delo that they are monitoring the consequences that Agrokor’s problems will cause in the Western Balkans region and suggested that there is a possibility of financial support for companies that might face difficulties due to the group’s illiquidity.

When asked about the relationship between EBRD and Agrokor, Heilbronn said that EBRD still holds a minor 2% ownership stake in the struggling group, but does not actively participate in its management.

>>>Miodrag Šajatović: The American nexus of politics and business has also emerged in Croatia

In response to a further question about how the activities to rescue Agrokor will affect the food processing industry in the region, given that EBRD provided a loan to Podravka last year, he suggested that there is a possibility of financial support for companies that might face problems due to Agrokor’s illiquidity.

>>>Agrokor pledged ‘half of Slavonia’

“This is a serious issue, and we are also monitoring the consequences that Agrokor’s problems will cause in the region. We are particularly watching whether and how we might provide support to subsidiaries in the countries involved in this story,” said the EBRD Vice President.

In an interview with Delo on Monday, the EBRD Vice President stated, among other things, that EBRD has invested 13.5 billion euros in the Western Balkans region in recent years and plans to invest another billion soon, in an effort to physically and economically connect the area and make it more attractive to foreign investors.

‘Unique Investment Space’

Among EBRD’s regional goals are the establishment of a regional chamber of commerce to achieve a “unique investment space” and the connection of regional stock exchanges.

For this reason, EBRD also finances the Zagreb Stock Exchange, which took over the Ljubljana Stock Exchange several years ago, Heilbronn said.

>>>VTB: Loss is certain, we will collect 50 to 60 percent of Agrokor’s debt

“We encourage the development of individual exchanges, and in our opinion, the future lies in their connection. This would ensure greater depth for the capital market in the region,” said Heilbronn, adding that efforts are also underway to connect exchanges across Southeast Europe into a single network on an electronic platform.

Potentially, this is a market with a turnover of 25 billion euros, with 600 companies that would seek fresh capital through privatization, listing on the stock exchange, and public offerings of shares (IPO) in the future, Heilbronn explained.

In six countries in the region, EBRD traditionally supports financing of physical infrastructure, as well as transition and privatization.