Agrokor

Sale-leaseback Financing

May and December 2010

As the largest private company in Croatia, The Agrokor Group is a leader in the food industry and retail sector of the CEE.  The Company’s vertically-integrated business has approximately 40,000 employees and almost €4 billion in revenues.  Among its many brands and products, Agrokor is the Croatian market leader in such areas as, beverages (including water, juices and soft beverages), ice cream and frozen foods, flour, salt, oils, mayonnaise and margarines, meat products, as well as the production and distribution of fruits and vegetables.

Situation:  In order to strengthen its balance sheet and pay off existing debt Agrokor wanted to raise capital through the sale leaseback of six retail supermarket/hyper-market facilities leased to Konzum, the largest food retailer in Croatia and a subsidiary of Agrokor. Based on its prior experience working with W. P. Carey Agrokor approached W. P. Carey for this second financing. 

Financing: The W. P. Carey Group purchased the six retail facilities, subject to long term net leases, thereby effectively providing €49 million ($64 million) of liquidity to Agrokor.

Outcome: By freeing up the capital from these real estate holdings, Agrokor was able to reduce its debt, strengthen its balance sheet and W. P. Carey was able to secure six critical assets leased to Konzum on a long term basis, enhancing its existing relationship with Agrokor.