March 17 (SeeNews) - Croatia's Agrokor said on Friday it has no overdue tax liabilities after local media reported the privately-held concern allegedly owes the government 6 billion kuna ($869.6 million/809.6 million euro).
"On an annual basis, Agrokor pays Croatia 3 billion kuna in taxes, of which more than half is VAT, while the remainder is mostly contributions and income tax", the company said in a statement.
Also on Friday, Croatian media reported that Agrokor and Russia's Sberbank have reached loan deals worth a total 300 million euro ($322.3 million), which should allow the ailing company to service debt to suppliers.
With these funds, Ivica Todoric's concern has bought time and is now expected to deliver a restructuring plan, news daily Vecernji said.
There has also been media speculation that Russian banks may shortly acquire a portion of the company's equity and launch an overhaul. The company made no comments on these reports, but said earlier this week that it is exploring all options to stabilise its operations in cooperation with its partners and investors.
The government has also pledged its support and revealed that several government and parliament representatives met with Agrokor officials to discuss the company's financial difficulties and the lowering of its credit rating.
The meeting has sparked speculation that the government may opt for a bailout scenario in a bid to save Croatia's largest retail concern.
A Zagreb-based analyst, Luka Brkic, told SeeNews that Agrokor's collapse would spell a huge trouble for the Croatian economy. He, however, insisted that government aid to Agrokor would be unfair treatment.
"I hope the government doesn't intervene because this would open a series of fundamental political-economic questions and doubts", Brkic said.
He added that a reshuffle of property and finances at Agrokor can certainly be expected.
Agorkor's problems seem to have boiled over at the end of February when Moody's Investor Services said it has changed its outlook on the company from stable to negative, after in January it downgraded the Agrokor's corporate family rating (CFR) to B3 from B2.
Following Moody's January decision, Agrokor pulled out of a syndicated loan deal it had struck with several international lenders, which sent the price of its bonds on international markets into a downward spiral.
Standard&Poor's Global Ratings also said earlier this month that it has lowered to 'B-' from 'B' its long-term corporate credit rating on Agrokor, with a negative outlook.
Croatian media have been speculating that Agrokor will need to sell off a number of its affiliates in order to service its obligations, which include a PIK loan it took out in 2014 to fund its acquisition of Mercator.
($=7.41092 euro)