September 20 (SeeNews) - Talks between the European Commission and the Croatian government on a restructuring plan for indebted Croatian mechanical engineering group Djuro Djakovic [ZSE:DDJH], including its acquisition by Czech company DD Acquisition, are gaining momentum, Zagreb-based media reported.
The parties to the talks plan to wrap them up by the end of the week, daily Jutarnji List reported late on Sunday, citing unnamed sources.
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Company officials were not immediately available to comment.
According to the restructuring plan, DD Acquisition will boost its share in Djuro Djakovic from 18.8% to a controlling stake.
The restructuring should be agreed with the Commission as the Croatian government took a decision in January 2020 for provide state guarantees to life-saving 300 million kuna ($46.9 million/40 million euro) loans provided by commercial banks and state development bank HBOR to the company to enable it to continue operating.
According to Jutarnji, unofficial estimates show that the company owes 360 million kuna in outstanding liabilities which the Croatian government will have to cover if the Commission approves the restructuring plan.
The company's shares surged 25.94% to 3.69 kuna on the Zagreb bourse intraday on Monday.
(1 euro= 7.502 Croatian kuna)