After the Osijek-based Žito, owned by Marko Pipunić transformed from a limited liability company into a joint-stock company at the end of last year, speculation about the company’s stock market debut began, as reported in the media. Although we spoke with Pipunić at that time, there was no confirmation regarding this, and the media that reported the company was going for an IPO did not have a solid confirmation either. Nevertheless, it is very likely that this will happen, marking a new direction for Žito after the failed acquisition of Fortenova’s agricultural business.
This failure will likely remain, at least for some time, a sore spot for Pipunić, considering that, from our previous conversations, he seemed very invested in Belje, Vupik, and PIK Vinkovci, but it was already felt then that Podravka was the main favorite in that race. The question is whether Žito would have pursued an IPO had it succeeded in acquiring those three Fortenova companies. And we immediately answer – probably yes. In fact, it seems that this direction was primarily charted due to those plans, but now that the company has warmed up to the idea, they could comfortably say: ‘Why not?’
No Confirmation
For now, therefore, there is no confirmation, so we can only reiterate what Sanda Kuhtić, Head of Corporate Communications at the Zagreb Stock Exchange, told us when responding to a potential IPO of ING-GRAD: – Listing on the Exchange is merely the final step of the entire process, meaning that shares are listed at the request of the company only after a successfully conducted IPO. If all documentation submitted by the future issuer is in order, the listing is approved very quickly, in no more than a few days.
If it indeed turns out that Žito is going for an IPO, it will be a new phase in the company’s development, and there is no doubt that there could be considerable interest. Perhaps even Pavao Vujnovac, who is currently steering Fortenova. After all, Žito Group is one of the strongest agricultural processing companies in Croatia, and moreover, the largest by revenue. With €317.1 million and a share of 34.4% in the total revenue of the sector (€923.3 million), it is the market leader, followed by Agronom from Požega with €122.7 million or a share of 13.3%. In third place is Novi agrar from Osijek with €34.8 million or a share of 3.8%, and since this company is wholly owned by Žito, this revenue and share further increase Žito Group’s stake in the sector. And while we mention Agronom, which is owned by the Czech Agrofert, this company is constantly seeking investments (read: acquisitions) in the region, so it is not excluded that they are also calculating whether it would be worthwhile to invest in Žito. As we should not overlook the activities of Hungarians who have been increasingly investing in Slavonia over the past decade, driven, at least as it seems to us, by (also) political motives.
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