LONDON, Feb 24 (IFR) - Agrokor said reports of electricity
outages at its Mercator stores are not correct, after stories in
local press sent the Croatian company's bond prices tumbling on
Insajder.net reported on Thursday afternoon that electricity
at several Mercator stores in Serbia had been switched off,
attributing the outages to unpaid rent and electricity bills to
a local landlord.
A spokesman for the food producer and retailer told IFR on
Friday that the story was inaccurate, however.
"The information about Agrokor's Mercator stores in Serbia
being without electricity is not correct. They are operating
under regular conditions," he said.
Agrokor's bonds sold-off sharply earlier on Friday morning,
which investors attributed to an English language version of the
story that appeared on website POST Online Media.
Its €325m 9.125% 2020 senior unsecured note dropped more
than six points to a cash price bid of just 71.625, according to
Tradeweb. This equates to a yield of around 23%.
Debt at Croatia's largest private company has plummeted in
value in recent weeks on concerns around the company's finances,
with a holding company PIK note falling to as low as 25 cents.
Moody's changed the outlook on Agrokor's B3 credit rating
from stable to negative on Friday, reflecting the "uncertainties
weighing on its credit profile".
The changed outlook came after the ratings agency described
Agrokor's accounting as "opaque in certain areas" in a report
published last week.
IFR reported earlier this month that investors were also
concerned around the company's accounting policies, particularly
the way Agrokor accounts for investments at subsidiaries in its
(Reporting by Robert Smith)