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Moslavina voće, a Fortenova Group company and an important Croatian agricultural producer, invested almost EUR 350,000 this year in a cornichon cucumber plantation spreading across 7.2 hectares. This high-quality cucumber sort is primarily intended for processing and pasteurisation, and due to this investment its domestic production has been increased by 50 %.
Namely, over the last 15 years the production of cornichon cucumbers in Croatia was significantly reduced. Back then, around 2500 tonnes were being purchased, while today the purchased quantities are around 500 tonnes. This year already, the new plantation is expected to yield around 250 to 300 tonnes, which is half of the total quantities purchased from small farmers across the country, while over the next years it is planned to further increase the production on our plantation.
On this occasion Ivona Tupek, Managing Director of Moslavina voće, stated that this was a unique plantation in this part of Europe, equipped with a so-called FLAT hail protection net and an irrigation system from the company’s own lake.
„Over the previous years we were witnessing a shortage of some vegetable cultures, including cornichon cucumbers which are used for pickling. This is a sensitive culture, and investments in irrigation and fertirrigation, as well as hail protection, have set new standards in the domestic agricultural production. Although Croatia used to have a strong tradition in growing cornichons, until recently the production was almost about to become extinct. The large new plantation is a great step forward in revitalizing that culture, as well as a signpost for sustainable and modern agricultural production in Croatia”, Tupek said.
The investments followed after a major challenge last year, the first year of planting cornichon cucumbers, when in July 2024 hail destroyed the plantation immediately after commencement of the harvest. This year’s yield is mainly of premium quality (first class), and the deliveries to Naturala, the largest domestic buyer of cornichons, have already started. By way of reminder, Naturala is also part of Fortenova Group, which additionally strengthens the connections and synergy within the system and provides consumers with high-quality domestic products on the shelves.
In addition to growing cornichon cucumbers, Moslavina voće is also Croatia’s largest producer of apples, with an impressive 263 hectares of total area, whereof 160 hectares are covered with plantations featuring more than 650,000 apple trees. The largest apple orchard in Croatia, Obreška, is located in the hilly area around Kloštar Ivanić, where the first plantations were raised in 2004 and modernized in 2017.
Fortenova Group and Podravka signed a sale-purchase agreement, whereby Podravka has acquired the companies from Fortenova Group’s Agriculture Division, comprising Belje, Pik Vinkovci, Vupik, Energija Gradec, Belje Agro-Vet and Felix.
The value of the transaction on a cash-free/debt-free basis is EURO 333 million. Podravka shall acquire the vertically integrated agriculture operations diversified in 12 segments, from growing crops on 32000 hectares of farmland and operations including pig and cattle breeding farms, winegrowing and viticulture to the production of final meat and dairy products. The companies from Fortenova Group’s agriculture segment also hold biopower plants, silos and the reloading port of Vukovar and employ a total of more than 2600 employees. The agricultural segment is also connected to several hundred subcontractors through contract farms as well as individual contract farmers in crop, vegetable and fruit production.
“The fact that we have very quickly concluded the negotiations about all the conditions of the transaction testifies that we have made the right decision by choosing Podravka and is a great precondition for a long-term partnership in this area as well, which we are about to start today. With this agreement both companies are opening new stages in their respective operations, and I am sure that our agriculture will be in good hands, as we have paid attention to selecting a partner that will truly make the maximum contribution to the further development of the business. I would like to thank all employees of the Agriculture Division and Fortenova Group, who have over the last six months worked hard to bring the realisation of this process to the point of signing the agreement” – said Fabris Peruško, Fortenova Group’s Chief Executive Officer and Member of the Board of Directors.
The completion of the transaction shall follow once the usual regulatory approvals are obtained.
Following the assessment of the binding offers received in the interest gauging process of the Agriculture Division divestment procedure, Fortenova grupa d.d. has evaluated the offer from Podravka d.d. as the best overall.
Accordingly, the two companies have signed an Exclusive Negotiations Agreement, pursuant to which Fortenova Group will continue the negotiation process on closing a sale-purchase agreement only with Podravka.
Fortenova Group’s Agriculture Division comprises the companies Belje, PIK Vinkovci, Vupik, Energija Gradec, Belje Agro-Vet and Felix. Detailed analyses of the binding offers received have shown that Podravka’s bid, besides offering the highest price, also in the best possible way meets the criteria set in the transaction as the most desirable strategic partner for those companies.
„We entered the interest gauging process for the Agriculture Division divestment with a view to maximizing the value and identifying potential partners who would be able to guarantee the development and sustainability of this nationally important industry and securing the further development of its operations and employment, the result thereof being the economic prosperity of the entire region of Slavonia and Baranja. We have found precisely such partner for our agricultural companies in Podravka. Podravka’s additional advantage is the fact that with it we would gain a strategic partner that would continue to provide high-quality domestic raw materials for further processing and production for PIK Vrbovec and the entire Fortenova Group system. Therefore, I am sure that by selecting Podravka as our exclusive partner to negotiate the details of the sale-purchase agreement we have made the best possible decision not only for the agricultural companies and our employees, but for all other stakeholders as well” – commented Fabris Peruško, Fortenova Group’s Chief Executive Officer and Member of the Board of Directors.
Herewith the half-year process of selecting a strategic partner for Fortenova Group’s agricultural operations has entered its final stage, and following the conclusion of the sale-purchase agreement it will be necessary to obtain the usual regulatory approvals from the competent market competition authorities in order to close the transaction.
Fortenova Group has received a number of non-binding offers for the acquisition of its Agriculture Division. After conducting additional discussions with the buyers, Fortenova has decided to proceed to the next stage of the potential divestment process by inviting a number of selected local and Regional buyers to take part in a due diligence phase after which the potential buyers will provide final binding offers.
The process started by sending information materials to a wider number of potentially interested buyers. The non-binding offers received have demonstrated that there is strong interest in the market in acquiring Fortenova Group’s Agriculture Division.
Fortenova Group will assess the final binding offers not only on price but also in respect of how the buyer will propose to be a strategic partner for the Agriculture Division as well as Fortenova.
When it comes to the process of selecting a strategic partner, it will – just like it was the case with the divestment of the Frozen Food Business – focus on those that will, in addition to paying a fair price, be able to make the maximum contribution to the further development as well as to the preservation of employment and tradition in agricultural production.
“We are happy to enter the due diligence phase with several exceptionally strong potential partners. Although we are now about to enter the due diligence phase, the final completion of a sale still depends on finding a strategic partner that will recognise the full value and potential of this business and its people,” said Fabris Peruško, Fortenova Group’s Chief Executive Officer and Member of the Board of Directors.
By sending a teaser to multiple possibly interested buyers, Fortenova Group has commenced the process of assessing interest in the potential sale of its agricultural business division.
By the end of the first quarter, Fortenova Group anticipates receiving non-binding offers from potential buyers, after which a decision will be made regarding the continuation of the potential sale process. Similar to Fortenova Group’s sale of the frozen food business division completed in 2021, the continuation of the process will depend on the quality of non-binding offers from potential strategic partners and will be focused on those willing to not only offer a fair price, but also make a maximum contribution to the further development and preservation of employment and the tradition of agricultural production in Croatia.
In recent years, Fortenova Group has made significant investments in the agricultural sector, thereby increasing the overall value of this business division. One of the major investments made just last year was the renewal of agricultural machinery valued at over 60 million euros.
Should the sale be realized, the proceeds from the sale would be used to further reduce Fortenova Group’s indebtedness as well as for strategic investments in other core business areas, such as retail and food.
Tihomir Adam, former Director for Investment Monitoring at Fortenova Group, is the new President of the Management Board of Belje.
In that position he will replace Andrej Dean, who has decided to continue his career outside of Fortenova Group. This is also an opportunity to thank him for his contribution in managing the Agriculture Division and the company Belje and wish him a lot of professional and personal success going forward.
Tihomir Adam has been working within the system since 2007, when he had assumed position as Direcor of Investments at Agrokor, which he held until 2014. He then joined Zvijezda in the position as Member of the Management Board in charge of production, to become President of the Board in 2017 and lead the company until February 2021. During the period of significant changes in the system, under his leadership Zvijezda generated excellent results and with the optimization of costs and the improvement of the company’s financial resilience, a high level of innovation has been retained in the Zvijezda portfolio. Adam joined the Fortenova Group team in the position as Group Director for Investment Monitoring on 1st February 2021.
Until further notice, responsibility for the Agriculture Division will be assumed by Fabris Peruško, Fortenova Group’s Member of the Board of Directors and Chief Executive Officer.
The Government delegation got acquainted with the Mitrovac production system, based on the synergy of a dairy cow farm, a biogas facility and a greenhouse for growing tomatoes, which also illustrates the basic determinants of Belje’s operations – the production of local food and traceability from field to table
Within the scope of their working visit to Eastern Slavonia, Andrej Plenković, Prime Minister of the Republic of Croatia, accompanied by Marija Vučković, Minister of Agriculture, visited the Mitrovac agricultural complex at Belje, comprising a dairy cow farm, a biogas facility and a greenhouse for the production of tomatoes.
The Government delegation was acquainted with the Mitrovac production system, based on the synergic connection of a dairy cow farm with a capacity of 2000 cows, a 2 MWh biogas facility and a 4.5 ha greenhouse. The biogas facility uses raw material from the farm to produce electric power and heat, used in the greenhouse for a year-round production of tomatoes.
The Mitrovac agricultural complex thus illustrates the basic determinants of Belje’s operations – production of local food, traceability from field to table and sustainability, which have in these challenging times proven to be very important for the Croatian economy.
As Croatia’s largest agricultural and industrial complex, Belje boasts an agricultural production that follows all global trends and can produce sufficient quantities of local food. Belje tills 20,000 hectares of arable land and 650 hectares of vineyards, produces 35 million litres of milk a year and accounts for 35 per cent of Croatia’s pig production as well as 14 per cent of Croatia’s cattle production.
„With the agricultural potential that Belje has, just like the whole of Slavonia and Baranya, Croatia can produce sufficient quantities of food, primarily for its own needs but also for exports. Belje has systematically invested in the development and strengthening of its production capacities and has continuously produced local foods from our fields and farms. In spite of the challenging circumstances that we are facing, all agricultural works have been carried out according to plans and all our productions work at maximum capacities, as best witnessed by the results of the animal feed factories that in March recorded the largest monthly production in the company’s history“ – said Davor Bošnjaković, Managing Director of Belje plus.
Vlado Čondić Galiničić, Executive Director for the Business Area of Agriculture at Fortenova Group and also President of the Agriculture Group of the Croatian Chamber of Commerce, as well pointed out that the corona crisis has proved the importance of local agricultural production and the food industry tied to it.
„This knowledge can be used to strengthen the national agricultural strategy and resourse management. What we need now is a serious structural determination as to what we want and can produce in the forthcoming period, ie. a decision with what products we strive for self sufficiency and we should then develop in that direction. In our country we can produce sufficient meat, milk, cereals….. as there is enough room, experience, historical knowledge and people willing to work“ – Čondić Galiničić said.
Fabris Peruško, Chief Executive Officer of Fortenova Group, among other matters, drew the attention of the Government delegation to the fact that Fortenova Group’s strategic determination to develop the regional agricultural and food production of local origin on all markets where it operates, and the emphasis on products of local origin in purchasing and sales, was one of the key levers during the corona crisis in securing the supply of the market with the most important food products.
„Fortenova Group’s specific advantage in doing so was its regional footprint and cooperation, as the commercial flows within our region were functioning despite the global crisis“ – said Peruško and added: „Companies like Fortenova Group can lead the way in strenghtening the offer of local products both on the domicile market and in exports. This particularly applies to agriculture and food production, because we have all the prerequisites – heritage, high product quality and consumers who are used to those products and appreciate them highly. Hence, in a more intensive development of local production we should count on an even stronger local consumption, which shall also become a strong contribution to preserving economic activities and jobs in Croatia.“