International Financial Law Review has published the article "The full Agrokor story: Croatia's first extraordinary administration," written by Akin Gump financial restructuring partners James Roome and Liz Osborne and counsel Jon Webb. The authors, who all worked on the team that advised Agrokor d.d. in connection with its restructuring (click here to learn more), discuss the matter in depth.
The article outlines the path that led the Croatian food and retail conglomerate into bankruptcy. Roome, Osborne and Webb write that, while the company's annual revenues once topped €5 billion, by the end of 2016, when Agrokor "embarked on a major refinancing exercise, the group had third-party liabilities of approximately €5.2 billion." In February 2017, the company took an additional €100 million loan, but that funding "was insufficient to address the liquidity and balance sheet crisis in the group."
The authors then discuss the enactment of a law "designed as a new rescue procedure for huge Croatian companies in desperate financial condition" and detail the restructuring negotiations that followed over the next 15 months.
The article concludes by observing that the "lack of precedent in Croatia saw the restructuring rely heavily upon international best practice and expertise to fill the gaps in the Croatian legal framework." In the end, the authors add, the restructuring "emphasized the importance of early engagement with all key stakeholders, and of giving creditors a voice throughout the process."