Mercators management board said it cannot continue to support the sale of a 50.3% stake in the retailer to Agrokor

Mercator's management board said it cannot continue to support the sale of a 50.3% stake in the retailer to Agrokor

The management of Slovenian retailer Mercator has pulled its support for talks to sell the company to Croatian rival Agrokor, citing concerns over third-party involvement.

Mercator's management board said it cannot continue to support the sale of a 50.3% stake in the retailer to Agrokor, claiming the European Bank for Reconstruction and Development (EBRD) and the International Finance Corporation (IFC) are part of Agrokor's bid, but is not a "member of the consortium of buyers."

Today (28 November) Mercator released a statement to the Ljubljana Stock Exchange saying it would be willing to reconsider the possibility of support to the transaction if either the EBRD or IFC is included as a member of the consortium of buyers. 

It said: "Any agreement between Mercator and the consortium of buyers that would include Agrokor, EBRD, IFC... is not possible because such composition of contractual parties in a consortium does not exist.

"As a result, support to the transaction in the previously defined form is not possible."

An EBRD spokesperson said Agrokor had approached the organisation with a request to provide financial support for its bid, which the EBRD accepted, and provided a letter of support for Agrokor's non-binding bid on 17 October.

"In summary, EBRD's position on supporting Agrokor has not changed," she added.

Eleven owners of Mercator, among them beverage producer Pivovarna Lasko and Slovenia's largest bank Nova Ljubljanska Banka NLB, put the majority stake up for sale in September.

In October Slovenian media reported that Agrokor planned to offer EUR221 (US$294.8) per share for the retailer.