Bloomberg News

Slovenia’s NLB Bank Postpones Mercator Holding Sale Once Again

January 24, 2012

Jan. 24 (Bloomberg) -- Nova Ljubljanska Banka d.d., which owns just below 11 percent of Mercator Poslovni Sistem d.d., once again postponed the decision to sell its holding in the Slovenian store chain and put the decision to the bank’s shareholders.

“The supervisory board couldn’t decide on the sale due to lack of quorum,” the Ljubljana-based lender said in an emailed statement. The supervisory board proposed “to call a shareholders’ meeting to decide on the sale of the Mercator stake,” according to the statement.

NLB and other Slovenian banks were in exclusive talks with Croatia’s Agrokor d.d. to sell the 52 percent stake in Mercator. Croatia’s largest private company offered 221 euros per share valuing the Slovenian retailer 832 million euros ($1.08 billion). The sale was delayed in December after increased opposition from Mercator’s management and Slovenian officials that forced Bozo Jasovic, the chief executive officer of Nova Ljubljanska to resign.

Slovenian banks need to raise fresh capital as the faltering economy pushes more companies into bankruptcy, forcing lenders to set aside record amounts of cash to cover bad loans. The banking industry will see “even bigger” losses this year as the economy slides into recession, the jobless rate rises and corporate losses increase, central bank Governor Marko Kranjec said earlier this month.

Mercator earlier this month abandoned its plan to takeover Pivovarna Lasko d.d. on concern about the financing risk. Agrokor’s offer for Mercator is valid until the end of February, the Zagreb-based company has said.

Mercator, which lost 23 percent of its value since the Nov. 18 peak, was little changed in Ljubljana today at 140 euros after dropping as much as 6 percent in early trading. The stock lost just below 5 percent of its value this year, giving the company a market value of 527 million euros.

--Editor: Douglas Lytle, Colin Keatinge

To contact the reporter on this story: Boris Cerni in Ljubljana at bcerni@bloomberg.net

To contact the editor responsible for this story: James M. Gomez at jagomez@bloomberg.net


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