ZAGREB, July 26, 2019 - The Fortenova Group, the successor to the Agrokor conglomerate, said on Friday that over 80 percent of holders of depositary receipts had voted in favour of new financing led by the US investment fund HPS Investment Partners.

At a general shareholders' meeting in Amsterdam today, over 80 percent of holders of depositary receipts of Fortenova Group STAK Stichting voted in favour of a new financing arrangement for the Fortenova Group to refinance the Super-Priority Term Facilities Agreement of 8 June 2017, the group said in a press release.

New financing is structured as a four-year bond of up to 1.2 billion euro with an interest rate of 7.3 percent, plus EURIBOR with a floor of 1 percent, and is led by HPS Investment Partners. The refinancing process is expected to be completed by the end of August.

The result of the vote shows that a large majority of our shareholders recognised the importance of new financing for the Fortenova Group in terms of ensuring the company's medium-term financial stability and long-term sustainability, growth and development, Fortenova CEO Fabris Peruško said.

He said that after the completion of the transaction, the group's focus would be on increasing profitability and creating added value for all stakeholders.

More news about the company can be found in the Business section.

ZAGREB, July 16, 2019 - The Zagreb-headquartered Fortenova Group has stated that it is going to sell 117 properties irrelevant for its core business: retail and food and agricultural production.

It says on its web site that it "has started to dispose of non-core real estate and to this end the company has opened a special website in Croatian and English language."

The company explains that "offers for purchase of real estate shall be received in two stages. In stage one, lasting from 15 July to 16 September 2019, non-binding offers will be collected, while the process of receiving binding offers will last from 30 September to 30 October 2019."

The properties listed on the website and intended for sale are divided into categories: residential, commercial, land and other real estate.

The group provides detailed descriptions and condition and terms of sale for each property concerned, along with the starting price and instructions regarding the way of submitting offers for the property in question.

Fortenova was established on 1 April 2019, following the successful implementation of the Settlement Plan achieved between Agrokor's creditors.

"The creditors' Settlement is a financial and ownership restructuring plan achieved during the Extraordinary Administration Procedure conducted at Agrokor pursuant to the Act on Extraordinary Administration Proceedings in Companies of Systemic Importance for the Republic of Croatia," the company recalls.

More news about Fortenova can be found in the Business section.

Amid recent reports from the expert witness who revealed his damning findings about just how much of Agrokor's company money the Todorić family used for their own personal expenses, Ivica Todorić, the former owner of Agrokor, hits back publicly.

"The key thing I want to point out today is the fact that the money they're talking about for the fourth time, in what I have to admit is the most totally sensationalist manner, is my money, and I've paid all of the necessary taxes on it," stated the former Agrokor owner and boss.

Ivica Todorić spoke up about the matter in a post after the Croatian newspaper Jutarnji list published a shocking article about how much he and his family withdrew from Agrokor. As expected, Todorić has stated that all of that, and all that we see today, stems from the political need of Prime Minister Andrej Plenković and his government associates to try to hide their illegal, criminal acts surrounding the former Agrokor.

As Poslovni Dnevnik writes on the 1st of July, 2019, here is his statement is transmitted (and translated) in its entirety:

''Over the past few weeks, my team and I have presented a whole host of new evidence on the criminal acts carried out by the Prime Minister of the Republic of Croatia, Andrej Plenković, and his associates (the Borg Group and others, who've been very specifically mentioned), and we've presented what is, so far, the most comprehensive record of the crimes that took place within Agrokor. That document also has a number of high-profile addresses in the European Union in it.

The first thing I want to say to you, Mr. Plenković, is that you can see that Agrokor is not "PASSE".

Secondly, Mr. Plenković, the Agrokor affair and the Borg affair are the biggest corruption affairs in the history of this part of Europe, and you know that yourself today, as do the citizens of the Republic of Croatia, as does the region and the rest of Europe, they know it very well.

Thirdly, it's obvious that the fact that you've become a burden to yourself bothers you a lot, and with the same intensity, it probably bothers you a lot that you've become a political and legal bomb for the EU. If the content of ''findings'' published on the front page of a certain newspaper is true, then those findings, as I've already said, are fictitious criminal documents, perhaps also falsified, they're just your regular professionally created rubbish.

Everything we see today stems from the political need of Prime Minister Plenković and his associates in an attempt to try to hide their illegal, criminal acts. They're so afraid that they obviously don't understand how their attempts to conceal annihilation are failing because everything is on the table, and around the world, too.

The key thing I want to point out today is the fact that the money they're talking about for the fourth time, in what I have to admit is the most totally sensationalist manner, is my money, and I've paid all of the necessary taxes on it. Therefore, nobody ''took'' anything, that was my money, Becase Agrokor was a private company from 1989 until April 2017. I personally had private money there in accordance with the law, and I paid my taxes on that money correctly.

The Government of Croatia, governed by Andrej Plenković, is breaking down and is continuing with this fake news about me and my family, repeating the same untruths for the fourth time, to draw attention away from the enormous amounts of disturbing affairs, specifically from the recent HNS request for the dismissal of Minister Lovro Kuščević, and what's obviously for them a very unfavourable development of events surrounding the constitution of key EU bodies.

So, to repeat, I spent my private money, and Plenković and his associates have stolen someone else's money.

Obviously today in Croatia, under HDZ, not only can criminals nationalise and loot a private company with the use of an illegal law, but also decide who can do what with their own money which they've duly paid their taxes on.

I'm sure this won't go on for much longer.''

For more information on Agrokor (now Fortenova), Ivica Todorić and much more, follow our dedicated business and politics pages.

ZAGREB, July 1, 2019 - Russia's Ambassador to Croatia, Anvar Azimov, said on Monday that the situation at the Fortenova Group, previously called Agrokor, was stable and that Russian banks Sberbank and VTB had played a constructive role in ensuring the present stability.

Azimov was speaking to the press on the sidelines of the Zagreb-Moscow economic forum at the Croatian Chamber of Commerce.

Asked if the Russian interests in the Fortenova Group were well protected and if the Russian side was satisfied with the new company's leadership, he said that the situation was good and that both sides were pleased.

"The new company is stable. We are hoping for a good profit," Azimov said.

Asked if Sberbank, the main creditor of the former Agrokor food and retail conglomerate and now the single largest shareholder in the new company, would remain in Fortenova, the ambassador said he did not know how long it would stay, adding that he does know that it is present and involved.

Azimov said that "the problem has been solved" and that Sberbank and VTB had played a constructive role in it.

More news about Fortenova Group, the former Agrokor group can be found in the Business section.

The life and times of the now somewhat infamous Ivica Todorić and family aren't as public as they once were. The Agrokor affair has died down, and the company itself is now Fortenova. An era has ended and a new chapter has begun, but that doesn't mean that the secrecy surrounding the Todorić dynasty is any less interesting.

As Novac/Zeljko Petrusic writes on the 30th of June, 2019, just what was discovered in the independent findings in the Agrokor case? The evidence of Todorić's enormous misuse of funds is damning.

''I'm Ismet Kamal, a member of the Institute of Certified Accountants of England and Wales... The County State Attorney's Office in Zagreb, the plaintiff, ordered me to report as an independent expert in the report on the prosecution of Ivica Todoric and others in Case No. K-DO-161/17. This case concerns Agrokor d.d.'s activities and other affiliated companies and individuals over a longer period, which ended when an extraordinary administration [procedure] was launched in Agrokor on April the 7th, 2017.

In reviewing the material and preparing this report, I was helped by the team from KPMG, who I supervised and led, and who reported to me about the work, which I'd reviewed. Members of my team are native Croatian speakers and speak fluent English, and some even German. The views expressed in this report are mine,'' stated expert Ismet Kamal from the Polish affiliate of the renowned audit firm KPMG at the beginning of the report of his expert accounting and financial findings in the Agrokor case.

The finding, or report, as he calls it, was concluded on the 19th of June, 2019 and consists of 390 pages. In another document, consisting of 126 pages, there are also other additions which make up the integral part of his findings. Otherwise, Ismet Kamal once worked with both KPMG Croatia and KPMG Bosnia and Herzegovina.

In his findings, this expert largely confirms PricewaterhouseCoopers (PwC) auditor's findings in the audit findings for the financial year 2016, made at the order of Agrokor's extraordinary administration team. In this way KPMG' Poland's findings support all of the key charges of which Ivica Todorić and others have been accused, which involves a figure of more than one billion kuna.

To recall, at the end of 2017, the Zagreb prosecution initiated an investigation against Ivica Todorić, his sons Ante and Ivan, Hrvoje Balent, and their former associates at the very top of Agrokor's management.

They are charged with the criminal acts of abuse of trust in economic business and the counterfeiting of official documents, as well as violations of the obligation to conduct in keeping the books.

The focal point of the investigation concerns the lacunae of Agrokor's financial statements from 2006 to 2015 and the unfounded dividend payment to Ivica Todorić and his Dutch company Adria Group Holding BV. The expertise in this section is quite clear - Agrokor, in fact, had been operating at a loss throughout that entire period, so there was no place for dividend payments to owner Ivica Todorić. This is totals a massive 710 million kuna.

If Agrokor correctly applied international accounting standards in its financial statements, the annual financial statements would not be positive, but "cumulative accumulated losses on the day of the 31st of December, 2015, amounting to 3.4 billion kuna."

''Although Ivica Todorić was the ultimate owner of Agrokor, the irregularities I discovered in Agrokor's transactions with him, as well as in other circumstances, negatively affect the interests of other interest groups primarily made by creditors (and financial creditors and suppliers), as well as minority shareholders and other interest groups, such as employees. Some of my findings are that certain transactions have resulted in Ivica Todorić's benefit, to the detriment of the company, and in that regard I note that Agrokor as a joint stock company and its directors were subject to corporate legislation which, inter alia, requires directors to act in the best interest of the company.

The use of an inadequate accounting policy, which did not comply with International Financial Reporting Standards, resulted in misstatement in the financial statements. In this way, the liquidity and profitability of Agrokor were presented in a better light than they really were in and hence served as a shield to conceal the actual size of financial problems.'' stated the expert.

One of the most interesting parts of his expertise relates to Agrokor's subsidiary company in Switzerland, Agrokor AG, or, better to say, about the relationship between Ivica Todorić and his family with that particular company. The prosecution accuses Todorić of using Agrokor AG's funds for years for his private purposes, and having withdrawn at least 64 million kuna.

Agrokor AG was a company for centralised procurement for the entire Agrokor Group, in order to achieve better contractual terms when purchasing various commodities, as well as the possibility of using the more favourable credit lines offered by Swiss banks.

The flow of funds through that particular account was therefore large. Ivica Todorić, as well as members of his family, had been using this often, and partially using the means as if they were their personal cash, and in more way than one.

From 2009 to 2016, Ivica Todorić also received 9.2 million Swiss francs in cash from Agrokor AG AG, this is equal to about 55.6 million kuna.

As much as 8.8 million francs or 50 million kuna was spent on credit cards belonging to Ivica Todorić's family members, which was paid off by Agrokor AG, during the period from 2007 to 2016.

There were also 2.8 million francs, or about 19 million kuna of other private costs racked up by the Todorić family, an amount which was settled by Agrokor AG as a claim against the Croatian Agrokor.

Make sure to follow our dedicated politics and business pages for much more.

ZAGREB, May 14, 2019 - The Agrokor Group in 2018 earned consolidated audited revenues in the amount of 38.8 billion kuna, 1.8% down from the year before, while its operating profit grew strongly to 2.39 billion kuna and net losses dropped considerably in comparison to 2017, to 1.4 billion kuna, shows a report the group released on its website on Tuesday.

The consolidation covers 108 companies in which Agrokor has a controlling interest, of which 53 are in Croatia.

The group's consolidated revenues of 38.8 billion kuna are 712 million kuna or 1.8% down from 2017. Operating expenses dropped by 10.9% or 4.7 billion to 39.2 billion kuna.

The group's loss after taxation was 1.4 billion kuna, which is much less compared to the 2017 loss of close to 6.1 billion kuna.

Agrokor's extraordinary administration points to a strong increase in operating profits of 22% to 2.4 billion kuna, which is 427 million kuna more than in 2017. The growth in operating profits is owing to restructuring that has been launched in all business segments of the group, both in terms of revenue and in terms of expenditure.

The biggest generator of growth of operating profits were the retail and wholesale segments, namely the Konzum and Mercator retail chains.

The operating profit in the Retail and Wholesale segment totalled 1.2 billion kuna, an increase of 681 million or 133%.

The extraordinary administration said that the drop in revenue was mostly due to the Agriculture business segment recording a decline in the volume of trade in agricultural produce and lower market prices of fattened animals and semi-hard cheese as well as due to a drop in sales revenues of the Retail and Wholesale segment.

The Retail and Wholesale segment in 2018 earned sales revenues in the amount of 29 billion kuna, 3.9% less than in 2017. The drop was due to competitors' opening new production areas in Serbia and Montenegro, the Extraordinary Administration said.

It noted that the drop in revenues due to the closure of nonprofitable Konzum stores was compensated for with an increase in revenues of 5.7%.

The Food business segment in 2018 posted operating revenues in the amount of 1.2 billion kuna, an increase of 3%. The business revenues of that segment were down 106 million kuna or 1.2%, totalling 9.1 billion kuna.

The Agriculture segment earned revenues in the amount of 2.3 billion kuna, a drop of 18.6%, while operating profits totalled 113 million kuna, down 60%.

The extraordinary administration said that 2018 saw Agrokor's creditors close a debt settlement plan that was implemented in the first quarter of 2019.

The group's financing was stabilised through the extension of the Super-Priority Term Facilities Agreement (SPFA) loan and preparations for its refinancing.

Priorities for this year are the already launched process of refinancing the SPFA loan, operational restructuring and the elaboration of a new strategy for the Fortenova Group (the new name of the Agrokor Group, under which it started operating on April 1), the Extraordinary Administration said.

More news about Agrokor can be found in the Business section.

ZAGREB, May 12, 2019 - Prosecutors in London have been given the go-ahead to investigate the former owner of Croatia's Agrokor food and retail conglomerate, Ivica Todorić, in the Nexus case and in the case of sale-leaseback agreements between Agrokor and a US real estate fund, the N1 television channel says.

"Ivica Todorić could be questioned soon, just as he was questioned in the Agrokor case after his extradition from London," N1 said.

Todorić refused to waive his right under which each new procedure required approval from London, and his lawyers say they have no knowledge of any such approval being granted. Yet, prosecutors have notified them that a hearing will be held there, N1 said.

Croatia's Chief State Prosecutor Dražen Jelenić said recently that the investigation in the Agrokor case would most likely be completed by May 20, noting that it was a very complicated case. N1 recalled that after the completion of the investigation his office would have another three months to write an indictment.

The investigation of Ivica Todorić, his sons Ivan and Ante, and 12 Agrokor managers and auditors was initiated by the Zagreb County Prosecutor's Office in November 2017 on the suspicion that they had embezzled over one billion kuna (135 million euro).

Ivica Todorić was the only suspect in this case who was remanded in custody after his extradition from the United Kingdom. He was released on 7.5 million kuna (1 million euro) bail on November 20 last year and was banned from leaving Zagreb.

More Agrokor news can be found in the Business section.

Close cooperation between Britain and Croatia as Cambridge University students join forces with the Fortenova Group.

As Poslovni Dnevnik writes on the 18th of April, 2019, consultants from the University of Cambridge are working on a project to find the best solutions in the field of artificial intelligence and automation for Fortenova's operative companies. It seems that Croatia's Foretnova, the former Agrokor, is entering a new era indeed.

Fortenova Group's values ​​also include a leading role in the implementation of new technologies and cooperation with leading educational institutions in Croatia and across the world. Within this direction, Collaboration with the University of Cambridge, whose team of consultants, presented selected solutions in the field of artificial intelligence and automation to the management of the operative companies of the Fortenova Group. At the same time, companies with great potential to be partners of Fortenova in this area were presented.

Today, artificial intelligence and automation are used in 40 percent of large retail chains and consumer goods manufacturing companies, and it is expected that by 2021, their share will grow to as much as 80 percent. Since these solutions have a significant impact on both revenue and company operating costs, their implementation is totally unavoidable in any company that wants to really be competitive and a have a chance at being a market leader.

Therefore, Fortenova's management has started collaborating with the esteemed British Cambridge University in order to find proper solutions in the field of artificial intelligence and automation that have the greatest potential.

The collaboration of Fortenova's management team and a team of consultants from the University of Cambridge resulted in a detailed review of the international ''ecosystem'' of artificial intelligence and automation and a short selection of potential solutions, and after that, a meeting with the management teams of Fortenova's operative companies and an attempt at identifying the solutions with the greatest potential for application in those companies in the future took place.

Preferred solutions come from the field of image recognition, frameworks, image optimisation, shop-based optimisation on customer-led shopping, advanced customer analytics, which are focused on personalised access and micro segmentation, an extensive insight into market trends and the needs of consumers, and finally, inventory management optimisation. The team of consultants from the University of Cambridge will elaborate business cases for selected solutions in the next stage, followed by the implementation of the chosen pilot project.

Dragan Mrkajić, Fortenova's strategy director said on this occasion: "This cooperation supplements Fortenova's values, which wants to be a leader in the implementation of new technologies and to broaden its cooperation with educational institutions both in Croatia and the rest of the world. As leaders in its business areas, we're privileged to be able to cooperate with Cambridge University's MBA study consultants, as this business management study is considered to be the world leader in education. I consider this cooperation to be extremely productive and useful to our company, as it will definitely bring added value to our way of selling our products and the services we offer to our customers, as well as our supply chain.''

Ivan Babić, director of Fortenova's transformation, expressed his satisfaction with selected solutions: "The quality of final solution choice largely depended on the fact that consultants from the MBA study at the University of Cambridge were able to gain a comprehensive understanding of the way Fortenova does business. This was of crucial importance to the success of the project, including its organisational structure, its business objectives, its operational business and its product portfolio. The project has brought significant benefits to both sides in understanding key global trends, players, and case studies where artificial intelligence has improved business performance in the retail and food industry.''

Antonija Kožul, senior project manager at Fortenova, said: "The gathering together of the best talent and the most advanced technologies together with the enthusiasm of Fortenova's operative companies in their adoption make up the fundamental values ​​of our group. This project is about just that and this is precisely why I consider it to be a privilege that I'm the head of it."

Chayanika Ranasinghe, an MBA consultant from Cambridge University, described the collaboration as follows: "I was very interested in participating in this unique transformation which the Fortenova Group has begun to work on, with a highly motivated and dynamic team.''

Shuntaro Horiuchi, an MBA consultant from the University of Cambridge said on this occasion: "The Fortenova Group's project is striving to introduce new value in established and sophisticated work based on the latest technologies. I'm excited to have had the opportunity to take part in this ambitious project and I expect that this opportunity will accelerate further increase of value for buyers.''

Slaven Štekovic, an MBA consultant at the University of Cambridge, also stressed the regional impact of the project: "The focus of the Fortenova Group's introduction of state-of-the-art technologies in its business to enhance value for its customers was a key factor which motivated me to join this dynamic and intellectually stimulating environment. Along with the experience I've gained at the core of some of the leading high tech innovation projects, I recognise the tremendous value of cooperation with such an influential company in building a pilot project for the entire region of Central and Eastern Europe, and South East Europe.''

This project is the beginning of collaboration between Croatia's Fortenova Group and Britain's University of Cambridge, which will continue in the future through the transfer of knowledge, experience and the best business practices.

Make sure to follow our dedicated business page for much more.

ZAGREB, April 12, 2019 - The Živi Zid parliamentary party on Friday called on the Chief State Prosecutor's Office (DORH) to investigate the alleged unlawful siphoning of farm subsidies based on suspect registration in the ARKOD register for the identification of farmland and accused the Belje Plus company, a subsidiary of the former Agrokor Group, of taking over the lease of land formerly used by the now defunct Belje company without any legal grounds.

The Živi Zid told a press conference that after the Agrokor conglomerate ceased to exist, about 33,000 hectares of farmland was transferred to the Fortenova Group which has taken over Agrokor's business operations even though annexes to original lease contracts for that farmland have not been signed with most municipalities and towns where the land is located.

Party leader Ivan Vilibor Sinčić said that the Belje Plus company took over the lease of the land that previously belonged to the Belje company even though it did not meet the necessary criteria. According to regulations, he underscored, it is necessary to present evidence of ownership, which requires annexes to the original contracts which do not exist because the mayors of the municipalities and towns where that land is located have not signed any annexes. It is also necessary to obtain cadastral certificates from documents of title, which also do not exist, he said.

The party's secretary-general, Tihomir Lukanić, said that according to some estimates, Agrokor took about 150 million kuna in farm subsidies a year. "While the government's hawks are claiming that the majority of mayors have agreed to and signed the annexes in question, we are getting information from the field that that isn't true. We conducted a survey and six mayors did not respond, Vinkovci town authorities said that the procedure was underway while 22 towns and municipalities said that they had not signed any annexes," Lukanić said.

He wondered what the parliamentary Conflict of Interest Commission has been doing for months as it has not responded to the Živi Zid's report against Prime Minister Andrej Plenković in connection with the Agrokor affair.

More news about Agrokor can be found in the Business section.

ZAGREB, April 2, 2019 - The Konzum and Mercator supermarket chains and the Tisak tobacco and newspaper stands will constitute the core business of the new Fortenova Group, the successor to the Agrokor conglomerate, a source close to the new corporation's management said on Monday and announced the resolution of non-core property and re-scheduling of a roll-up loan.

The new company's focus will be on Konzum, Mercator and Tisak, the source said and added that the conglomerate's non-core property, valued at 150 million euro, was a huge challenge.

The source underscored that the Konzum and Mercator supermarket chains were very important for local producers.

The source added that now was not a good time to sell shares of the new company as it had to create new value and that its components were not ready for an IPO procedure either, which was why reorganisation was required.

With regard to the rescheduling of a roll-up loan taken to settle Agrokor's debts, the source said that negotiations were underway and that the rescheduled loan was expected to carry an interest rate of 8% or 8.5%, including all fees.

That loan amounts to 1.06 billion euro and currently has an interest rate of 11.5%, which is expected to grow to 14% by September, while the effective interest rate could be 18%, hence efforts are being made to re-schedule the loan before June.

The Fortenova Group has announced an analysis of financial costs incurred since the emergency administration in Agrokor was introduced.

The Fortenova Group officially started its business operations on Monday, taking over the Agrokor conglomerate's business.

Of the total of 159 companies that comprised the Agrokor Group, following a settlement plan with creditors, 47 unsustainable companies have been transformed into mirror companies that will have the word "plus" added to their names, which means, for example, that Konzum will now operate under the name Konzum Plus, Jamnica will be renamed Jamnica Plus and so on.

Shares in the remaining 30 viable companies doing business in Croatia will be transferred to the Fortenova Group and after the completion of the transfer, those companies will exit the emergency administration procedure.

Shares in 82 companies operating outside Croatia and those companies that were not included in the emergency administration procedure will be transferred to the Fortenova Group at the same time as the remainder of the conglomerate's property.

The emergency administration procedure will formally continue until all the old, unsustainable companies that were once part of Agrokor d.d. are taken over and Agrokor d.d. is struck from the court register.

More Agrokor news can be found in the Business section.