Croatia to Help Fund Podravka's Global Expansion

The Croatian government on Wednesday increased its capital in the partly state-owned food company Podravka by 5.6 million euro.

In this way, Podravka will be able to release an additional 141,000 new shares on the market, helping it to raise the capital it needs to complete the full acquisition of the Slovenian food company Zito, after buying 51.5 per cent of its shares in April.

Besides the state, which has a 9.8 per cent share in the company, the state pension fund, with a 10.6 per cent share, will invest an additional 5.8 million euro, while the state Capital fund will invest 3.2 million euro for its 5.9 per cent share in the company.

Podravka will thus in total collect around 68 million euro through 1.7 million euro of shares on the market, with a price of 40 euro a share.

At the same time, the state owners will preserve their overall share of more than 25 per cent of the firm, which gives them full management rights.

Chair of the board Zvonimir Mrsic has announced the company's plans to expand in European, Middle Eastern and North African markets, and potentially enter the London, Vienna and Warsaw stock markets.

"We think we will be able to grow faster than our competitors and be able to... become 'hunters'," he said.

Mrsic drew a comparison between Podravka and Nestle, stating that both countries are small states - Croatia and Switzerland - with international influence.

He announced that offices will open in Tanzania, Beijing and Dubai as the company shifts to becoming a global company.

"We are stronger than ever and we have too much to supply the regional market alone. We have a choice, to stay where we are and decline, or expand into new markets," he concluded.

Podravka is one of the strongest...