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ZAGREB (Croatia), July 14 (SeeNews) - Raiffeisenbank Austria said on Friday that if Croatia's food and retail concern Agrokor opts for the sale of its larger companies to rationalise operations and reduce indebtedness, Slovenia's retailer Mercator may be the first to go.
"Since Mercator, the only one among the larger members of the group, is not burdened by guarantees, we think it is the most likely candidate to be sold in the short run," Raiffeisenbank Austria said in a research report.
The market capitalisation of Agrokor's shareholdings in Mercator as at July 3 was 173.7 million euro ($199.1 million), or 5% of the concern's financial debt.
RBA explained that although Agrokor's Ledo and Jamnica have been mentioned as the most probable candidates for sale, both are burdened by joint guarantees for Agrokor's debt in the overall amount exceeding 20 billion kuna ($3.1 billion/2.7 billion euro).
"Accordingly, if Agrokor is unable to pay, creditors have the right to seek payment from these companies," the lender noted.
However, it warned, the amount of guarantees issued likely exceeds the market capitalisation of these companies, which means their future will be determined by the settlement with creditors which should be achieved mid-2018.
Agrokor has, for the time being, announced only its intent to sell non-core companies, ones that do not belong to any of the strategic branches of the corporation.
RBA also pointed out that companies of the Agorkor group, whose shares are listed on the ZSE, lost some 65% of their market capitalisation since April 27, when they were temporarily suspended from trading until their audited financial statements for 2016 come out.
Earlier this month, Russia's Sberbank acquired a 18.53% stake in Mercator at an auction after Netherlands-based financial holding company Agrokor Investments B.V. placed the shares as collateral on a loan extended by the bank to Agrokor.