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UPDATE 1-Croatia, Agrokor creditors plan to sign repayment freeze this week - VTB
March 29, 2017 / 5:20 PM / 6 months ago

UPDATE 1-Croatia, Agrokor creditors plan to sign repayment freeze this week - VTB

(Adds Agrokor comment)

MOSCOW/ZAGREB, March 29 (Reuters) - Croatia and a group of creditors to Agrokor plan to sign a “standstill agreement” this week to freeze debt repayments by the struggling food and retail group as part of debt restructuring talks, an official at Russia’s VTB bank said.

“Standstill will be relatively short at the beginning ... a week or a month, not a year,” Yuri Soloviev, first deputy chief executive at VTB, told reporters on Wednesday.

“Changes in the shareholding structure are possible following the debt restructuring,” he said, adding VTB’s exposure to Agrokor was around 300 million euros ($323 million).

Soloviev said the group of creditors was formed, and being chaired by, Russia’s Sberbank, the biggest lender to Agrokor.

Creditors expect to work out a debt restructuring plan and also look at options for Agrokor to sell part of its business to cut debt.

Soloviev said the creditors may provide Agrokor with short-term liquidity too. “A local development bank may also provide guarantees to suppliers to continue supplies. A combination of short-term financing... and government support is possible.”

Agrokor said it would soon release a statement about its current situation and future steps.

Earlier on Wednesday, the governor of the Croatian central bank said Agrokor’s difficulties would not destabilise the country’s financial system.

$1 = 0.9297 euros Reporting by Kira Zavyalova in Moscow and Igor Ilic in Zagreb; Writing by Katya Golubkova; Editing by Mark Potter

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