Slovenia Business Week no. 16, April 18th, 2006
Table of Contents:
HEADLINES ............................................................................................................................. 3
Revoz Remains Top Slovenian Exporter ............................................................................... 3
CCIS Forecasts 4.1% Economic Growth for 2006 ................................................................ 3
Factory-Gate Prices Up 2% Y/Y in March ............................................................................ 4
INTERNATIONAL COOPERATION ...................................................................................... 5
Government: Scandinavian Best Practices Applicable in Slovenia ....................................... 5
Slovenia Helps Macedonia Get Ready for EU Accession ..................................................... 5
Parliament Speaker Receives New Turkish Ambassador ...................................................... 5
EUROPEAN UNION ................................................................................................................. 7
Rupel Wants LB Debt Issue Solved as Soon as Possible ....................................................... 7
Trouble With Fund Phasing Reduces Slovenia's Net Recipient State ................................... 7
LEGISLATION .......................................................................................................................... 8
Government Adopts Changes to Insurance Act ..................................................................... 8
STATISTICS/FORECASTS ...................................................................................................... 9
Industrial Output Up 8.1% Y/Y in February .......................................................................... 9
Minister: Surge in Number of Engineering Enrolments ........................................................ 9
Government Adopts Revised International Cooperation Bill ................................................ 9
Panel: Privatisation Leads to Efficient Management ........................................................... 10
FINANCE................................................................................................................................. 11
Motorists Hit by Petrol Price Hike ....................................................................................... 11
LJSE Lively in March .......................................................................................................... 11
KAD Posts Bumper Profits for 2005.................................................................................... 12
Financial Conference Focusing on Euro and Capital Markets ............................................. 12
Euro Switch Preparations Proceeding as Planned at NLB ................................................... 13
Government Appoints Ivan Simic Head of Tax Administration.......................................... 13
Ljubljana Stock Exchange .................................................................................................... 13
REGIONAL INFORMATION ................................................................................................ 15
Western Slovenia Ski Resort Voted Best for 2005/2006 ..................................................... 15
BRANCH INFORMATION .................................................................................................... 16
Transport Ministers Sees Motorways, Railroads as Priority ................................................ 16
Security Important for Tourism, Official Says ..................................................................... 16
COMPANIES ........................................................................................................................... 18
Logistics Company Buys EUR 2.1m Worth of Vehicles ..................................................... 18
Mozina and Vasle Nominees for TV and Radio Directors .................................................. 18
Transmontagne Purchases ATC Kanin Debts ...................................................................... 18
Delo Gradually Getting New Editorial Board ...................................................................... 19
Altima Considers Mercator Long-Term Investment ............................................................ 19
Mercator Supervisors not Happy with Company's 2005 Performance ................................ 20
CEO Says Mercator to Talk with Retailers in the Balkans .................................................. 20
Hit Opens New Gaming Parlour .......................................................................................... 21
Mercator CEO Comments on Possible Tie-Ups with Petrol ................................................ 21
Slovenia Notifies Neighbours about Mura Hydro Plants ..................................................... 21
Delo Supervisors Appoint Mitja Pleterski to Management Board ....................................... 22
Government Adopts Development Programme for Lipica Stud Farm................................. 22
Istrabenz Publishes Takeover Bid for Droga Kolinska ........................................................ 22
Mercator Counting on Serbian Partner for Balkan Expansion ............................................. 23
Small Mercator Shareholders United in Talks with Altima ................................................. 23
SLOVENIA IN BRIEF ............................................................................................................ 24
Social Partners Discuss Technological Development and Growth ...................................... 24
Slovenia-Russia Association Celebrates 10 Years ............................................................... 24
Slovenia to Celebrate Books ................................................................................................ 24
Journalist Joze Hudecek Receives Lifetime Achievement Award ....................................... 24
Rupel and Austrian Ambassador on Slovenian Minority..................................................... 24
2
HEADLINES
Revoz Remains Top Slovenian Exporter
Car maker Revoz, a subsidiary of Renault, remained the biggest Slovenian exporter in 2005,
increasing exports by 35% year-on-year to SIT 265.5bn (EUR 1.1bn
Car maker Revoz, a subsidiary of Renault, remained the biggest Slovenian exporter in 2005,
increasing exports by 35% year-on-year to SIT 265.5bn (EUR 1.1bn). Revoz accounts for
7.8% of the country's total exports, according to a survey of exporters published by the daily
Delo on Monday, 10 April.
The top five includes household appliance maker Gorenje with exports at SIT 207.9bn (EUR
867.7m), followed by drug makers Lek (SIT 115.9bn/EUR 483.7m) and Krka (SIT
98.4bn/EUR 410.7m) and the Slovenian Steel Group (SIT 82.4bn/EUR 342.7m). The top five
accounted for 22.6% of the overall exports.
There was one notable absence from the top five spots for 2005 - Prevent, the maker of carseat covers, which was fourth last year. It placed 9th with exports at 54bn (EUR 225.4m),
down 34% year-on-year. The Slovenian Steel Group meanwhile climbed two places
compared to 2004.
Measured by exports to the EU, Revoz tops the list with sales there worth SIT 234.5bn (EUR
978.7m), followed by Gorenje (SIT 110bn/EUR 459m), the Slovenian Steel Group (SIT
61.8bn/EUR 257.9m), aluminium maker Impol (SIT 57.9bn/EUR 241.7m) and Prevent (SIT
54bn/EUR 225.4m).
Meanwhile, the biggest exporter of services was the gaming group Hit, with exports worth
SIT 49bn (EUR 204.5m), followed closely behind by logistics group Viator&Vektor (SIT
47bn/EUR 196.2m), Slovenian Railways (SIT 30bn/EUR 125.5m) and shipping company
Splosna plovba Portoroz (SIT 28bn/EUR 116.9m).
According to the forecasts for 2006 provided by the companies, Slovenia's exports are
expected to increase 5% this year, whereby 14% of the 198 companies included in the survey
expect exports to drop.
The forecasts of the top five exporters are mixed: Revoz expects exports to plummet by over
20%, Gorenje sees them level, Lek provided no data, Krka expects to up exports by roughly
10% and the Slovenian Steel Group expects them to drop.
The survey is based on data provided by the companies themselves. The authors point out that
exports have been classified in the traditional sense: sales to EU countries are counted as
exports, whereas the EU deems only sales outside the EU as exports.
CCIS Forecasts 4.1% Economic Growth for 2006
Inflation will stand around 2.3% and go up to 2.5% next year
The Chamber of Commerce and Industry of Slovenia (CCIS) forecasts that Slovenia's
economic growth will be 4.1% in 2006 and 4% in 2007. Inflation will stand around 2.3% and
go up to 2.5% next year, Irena Rostan of the CCIS's Economic Outlook and Policy Services
told the press on Friday, 14 April.
The beginning of the year was marked by a dynamic economic activity, with industrial output
and exports noting a positive growth rate. The trends were also good in the services sector,
especially in trade, tourism, transport and business, she added.
Positive trends are expected to continue in international trade, with exports of goods and
services steadily rising. According to Rostan, exports are still the main driving force of
economic growth.
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She believes that investments will influence domestic demand in the next two years, with a
4% rise in investments in intermediate goods, while private demand will go up by 3.1%.
Meanwhile, gross wages per employee are to increase by 2.3% in 2006, and 2.5% in 2007.
The CCIS moreover expects a steady rise in employment, by 0.8% for this and 0.7% for next
year. According to the ILO, however, the unemployment rate is to increase by 6.6% in 2006
and 6.7% in 2007. Last year, the ILO unemployment rate was 6.5%.
In Rostan's view, the forecast 2.3% or 2.5% inflation could be lower if prices of raw materials
would no longer increase or would start dropping, which is unlikely given the current trends.
Another risk with inflation is Slovenia's euro changeover planned for the beginning of 2007,
as the danger of retail prices increasing cannot be excluded despite the dual pricing period,
according to Rostan.
The CCIS has in its forecasts considered all possible risks, such as the euro adoption,
economic and social reforms (chiefly tax policy and labour market) as well as talks on the
2006-2009 social agreement and on the wages policy collective bargaining agreement.
Earlier this month, the Institute for Macroeconomic Analysis and Development upgraded its
GDP forecast for 2006 by 0.2 percentage points to 4.2%. It attributed the upgraded figure to
greater investment spending and better-than-expected trends in trade.
Factory-Gate Prices Up 2% Y/Y in March
Prices increased by 0.9% since the end of last year
Factory-gate prices rose 0.4% in March over the previous month, putting the year-on-year
price increase at 2%, according to the National Statistical Office. Prices increased by 0.9%
since the end of last year.
The highest increase year-on-year was recorded in electricity and water supply (4.7%),
mining (2.5%), manufacturing (1.6%) and forestry (0.4%).
In comparison with February, industrial prices in mining and manufacturing went up by 0.6%
respectively, forestry prices remained flat, while the cost of electricity and water supply
dropped by 0.1%.
The prices of intermediate goods (energy products and raw materials) increased by 0.7%, in
comparison with February, while prices of consumer goods were up 0.5%. Capital goods were
0.5% cheaper.
Year-on-year, intermediate goods were up 3.1% and consumer goods 1.5%, while the price of
capital goods dropped by 0.7%.
4
INTERNATIONAL COOPERATION
Government: Scandinavian Best Practices Applicable in Slovenia
A government delegation that recently returned together with representatives of seven trade
unions from a tour of Scandinavian countries assessed that some of Scandinavia's best
practices in the labour market and technological development could also be implemented in
Slovenia
A government delegation that recently returned together with representatives of seven trade
unions from a tour of Scandinavian countries assessed that some of Scandinavia's best
practices in the labour market and technological development could also be implemented in
Slovenia.
State Secretary at the Development Office Andrej Horvat, who headed the government
delegation, told the press on Monday, 10 April that the information obtained during the tour
between 2 and 7 April would now be examined in order to establish which measures could be
applied to Slovenia.
The Development Office and the trade unions representatives were united in the view that
while the different Scandinavian models could not be directly transposed to Slovenia,
examples of best practice could be extracted.
Meanwhile, Drago Lombar of the Independence trade union pointed out that the visit would
serve as a starting point for the negotiations concerning reforms and the social agreement.
"When our employers and the government come to the realisation that the people are their
only capital, the negotiations will also take a different course," Lombar added.
His words echoed a remark by Metka Roksandic of the Association of Free Trade Unions of
Slovenia (ZSSS), who said that Sweden in particular still perceives people as the only form of
wealth.
Slovenia Helps Macedonia Get Ready for EU Accession
A Slovenian delegation headed by Agriculture Minister Marija Lukacic was in Macedonia for
talks that focused on Macedonia's efforts to adapt its legislation to the EU body of law
A Slovenian delegation headed by Agriculture Minister Marija Lukacic was in Macedonia on
10 and 11 April for talks that focused on Macedonia's efforts to adapt its legislation to the EU
body of law.
Lukacic held talks with Economics Minister Fatmir Besimi and Minister of Agriculture,
Forestry and Waterways Sadulla Duraku.
According to the Agriculture Ministry, the visit was designed to help Macedonia in
transposing EU regulations, and to present Slovenian experience in the pre-accession period,
which is crucial for preparations for the phasing of EU funds.
The director of the Agency for Rural Development and Agricultural Markets, Franc Kebe,
meanwhile informed Macedonia officials about the agency's structure and the mechanisms for
the distribution of funds.
The ministry said in a press release that talks between kin institutions from both countries
would continue alongside twinning projects aimed at boosting the administrative capacity of
the relevant institutions.
Parliament Speaker Receives New Turkish Ambassador
The pair shared a view that political and economic cooperation between the two countries is
good
5
Parliament Speaker France Cukjati received the new Turkish Ambassador to Slovenia Melek
Sina Baydur on Friday, 14 April. The pair shared a view that political and economic
cooperation between the two countries is good, Cukjati's office said.
Cukjati is convinced that good relations, especially on the parliamentary level, will improve
further during Baydur's term.
He also said that Slovenia supports Turkey in its efforts and preparations to join the EU. "This
goal will also be reached, to Europe's and Turkey's great satisfaction," Cukjati was convinced.
Baydur, who was appointed ambassador to Slovenia this year after being ambassador to
Bosnia-Herzegovina, meanwhile briefed the parliament speaker on Turkey's latest reforms
package.
Baydur's predecessor to Slovenia was the much loved Balkan Kizildeli, who was selected
foreign diplomat of the year 2005 in Slovenia for his contribution to openness and
development in Slovenian society.
6
EUROPEAN UNION
Rupel Wants LB Debt Issue Solved as Soon as Possible
Slovenian Foreign Minister Dimitrij Rupel has called for the issue of the debt of the defunct
Slovenian bank LB to Croatian account holders to be solved as soon as possible
Slovenian Foreign Minister Dimitrij Rupel has called for the issue of the debt of the defunct
Slovenian bank LB to Croatian account holders to be solved as soon as possible.
"I have a burning desire to solve the issue and to remove it from the agenda of bilateral
meetings. It is burdening our relations and poisoning them," Rupel said at the sidelines of a
regular monthly session of the EU foreign ministers in Luxembourg on Monday, 10 April.
Rupel's response comes as the EU has drafted a call to Croatia, demanding a nondiscriminatory treatment of the bloc's companies in the financial sector by Slovenia's southern
neighbour in line with the provisions on free flow of capital in the stabilisation and accession
pact.
According to Rupel, this is not a threat as "it is all on the level of bilateral talks, pointing out
problems. We want Croatia to advance on the accession path as fast as possible...Slovenia
harbours no special interests, we are on the side of the EU, of European legislation".
The foreign ministers' call, although not detailed, is based on Croatia's decision to prohibit
Belgian banking and insurance group KBC - which owns 33% in NLB, the Slovenian bank
that was established following the downfall of the LB - to enter the Croatian market before
the LB settles its debt.
Trouble With Fund Phasing Reduces Slovenia's Net Recipient State
Slovenia was a net receiver in its second year of EU membership, getting SIT 4.53bn (EUR
18.9m) from the EU budget
Slovenia was a net receiver in its second year of EU membership, getting SIT 4.53bn (EUR
18.9m) from the EU budget. Yet this was far below plans, which anticipated Slovenia having
a SIT 42.76bn (EUR 178.47m) surplus from the EU in 2005, the Finance Ministry has said.
While the country contributed SIT 68.44bn (EUR 285.66m), it received SIT 72.97 (EUR
304.56m) from the Brussels purse, the ministry said on Friday, 14 April.
However, according to the 2005 supplementary budget, Slovenia should get SIT 115.9bn
(EUR 483.75m) from the EU, but poor phasing of structural and cohesion funds meant that it
only managed to acquire 63% of the anticipated sum.
Slovenia got SIT 26.76bn (EUR 111.69m) from the Common Agricultural Policy, SIT
21.81bn (EUR 91.03m) in lump sum returns, SIT 8.6bn (EUR 35.89m) from structural funds
and SIT 1.85bn (EUR 7.72m) from cohesion funds.
While agriculture managed to secure 98% of allocated funds, realisation of structural funds
stood at 32.1% and of cohesion funds at 18.4%.
The country performed even worse in EU funds allocated for interior policy, acquiring only
8% of the allocated Schengen facility means.
Meanwhile, Slovenia also paid SIT 4.7bn (EUR 19.61m) less into the EU treasury than
planned, the main reason being that the EU newcomers failed to realise their cohesion policy
plans.
Slovenia therefore only managed to retain net recipient status because of lower-than-expected
contributions to the EU budget.
7
LEGISLATION
Government Adopts Changes to Insurance Act
The government has adopted changes to the insurance act which include the provisions of two
EU directives published since the act was last amended in 2004
The government has adopted changes to the insurance act which include the provisions of two
EU directives published since the act was last amended in 2004.
According to Finance Minister Andrej Bajuk, who spoke after the government's weekly
session on Thursday, 13 April, the most significant change is the abolishment of risk
equalisation allowances.
The cabinet's proposal would bind insurers only to form equalisation allowances for loan
insurance, while having to abolish such provisions for 23 other types of insurance by January
2007.
By implementing international accounting standards, such provisions, which are nothing but
untaxed and undistributed profit, according to Bajuk, are no longer needed.
Moreover, as they were untaxed, the ministry will levy a tax on them. Bajuk estimates that the
budget would get an additional SIT 2.1bn (EUR 8.76m) in the three years.
The changes also allow insurers to act as brokers in purchasing and selling investment
coupons of mutual funds and perform limited reinsurance activities.
8
STATISTICS/FORECASTS
Industrial Output Up 8.1% Y/Y in February
Compared to February 2005, the manufacturing sector upped its output by 8.7%, while
volumes in electricity, gas and water supply were up 2.3% and in mining by 3%
Slovenia's industrial output dropped by 3.1% in February over the month before, but increased
8.1% year-on-year, according to the latest report by the National Statistical Office.
Compared to February 2005, the manufacturing sector upped its output by 8.7%, while
volumes in electricity, gas and water supply were up 2.3% and in mining by 3%.
Broken down by main industrial groupings, year-on-year output growth was fastest in
consumer goods industries (11.3%). In capital goods industries volumes grew by 9.5%, and in
intermediate goods industries by 5.4%.
Minister: Surge in Number of Engineering Enrolments
Data on first-year enrolment for university studies for 2006 shows a notable increase in the
number of young people opting for engineering studies and a significant drop in the number
of would-be social studies students
Data on first-year enrolment for university studies for 2006 shows a notable increase in the
number of young people opting for engineering studies and a significant drop in the number
of would-be social studies students, Higher Education Minister Jure Zupan has said.
According to Zupan, there has been a remarkable shift in favour of engineering studies in a
year when there were a total of 26,089 first-year enrolment requests (a drop of 3.8% on 2005).
The number of young people wanting to enrol in technics, production or civil engineering
full-time and part-time programmes rose 21% to 4,582, Zupan said.
Meanwhile, the number of high school leavers looking to enrol in social studies courses fell
by the same percentage to 6,793.
There has also been greater demand for agriculture and veterinary studies (910, up 10.7%),
teaching studies (3,623, up 4%) and natural sciences (1,736, up 2%), Zupan said.
Meanwhile, the number of young people wishing to enrol in services-related courses fell 7.5%
to 3,346 and those in arts and humanities courses dropped 0.6% to 1,749. There was little
change in the number of enrolments for health care studies.
Government Adopts Revised International Cooperation Bill
The bill defines international development cooperation as well as its goals, planning,
financing and implementation
The cabinet adopted the revised version of the bill on international cooperation at its session
on Thursday, 13 April, the Government PR and Media Office said.
The bill defines international development cooperation as well as its goals, planning,
financing and implementation.
It calls for strengthening bilateral and multilateral cooperation and includes other specific
goals, in line with Slovenia's interests.
The legislation will also allow the government to task qualified public or private institutions
with carrying out the technical and operational part of such cooperation.
It moreover defines the conditions under which companies can get involved in international
development.
According to the press release, the bill will allow Slovenia to carry out its role in the
international community as a donor and enable the country to fulfil its obligation, given at the
9
last year's European Council summit, to earmark at least 0.17% of its GDP for such projects
by 2010.
Slovenia is already active in such projects, especially with the Western Balkan countries. It is
spending over 0.1% of the GDP for international cooperation.
Panel: Privatisation Leads to Efficient Management
With the privatisation of top companies, especially the largest banks, the biggest insurer and
the national telco, Slovenia could get effective and successful management boards, agreed
participants of a panel at the two-day Capital 2006 financial days
With the privatisation of top companies, especially the largest banks, the biggest insurer and
the national telco, Slovenia could get effective and successful management boards, agreed
participants of a panel at the two-day Capital 2006 financial days.
It is however also important when and for how much companies are sold, and what the
purchase sum will be used for, the participants of the round table dubbed "Who Should
Slovenian Companies Be Sold to and Whether Should They Be Sold at All" said.
Bank Austria Creditanstalt Ljubljana chairman France Arhar, a former Bank of Slovenia
governor, said he would like to see the Zavarovalnica Triglav insurer and the Nova
Ljubljanska banka (NLB) bank remain in Slovenian hands.
He explained that the two companies have a monopoly on the market, and that one does not
sell monopolies. Banks and insurers abroad are linked, he added, which could also be
interesting for the Slovenian companies.
Former Development Minister Joze P. Damijan however disagreed with Arhar regarding NLB
and Triglav, as foreign banks in Slovenia are more competitive than NLB.
He believes that the money obtained from privatisation should not be spent for short-term
purposes, but should be development-oriented, for various technological funds, which would
enhance competitiveness in the future.
Damijan moreover assessed that Slovenians are too afraid of foreign capital and owners,
stressing that there have been only few bad foreign investments, while the majority of them
were a success.
Speaking about the state ownership of companies, he said that state officials cannot be better
supervisors than private owners, therefore, state shares in companies should be minimised.
Arhar and Damijan agreed that the stock market is a guarantee for transparency, while the
privatisation of large corporations would liven up the capital market.
10
FINANCE
Motorists Hit by Petrol Price Hike
A litre of regular unleaded went up by SIT 12.3 to SIT 237.90 (EUR 0.99), while diesel fuel is
SIT 2.6 dearer at SIT 229.10 (EUR 0.96) a litre
Slovenian motorists were hit by a hike in petrol prices as Slovenian fuel retailers adjusted to
surging prices of crude oil over the last month on Tuesday, 11 April. A litre of regular
unleaded went up by SIT 12.3 to SIT 237.90 (EUR 0.99), while diesel fuel is SIT 2.6 dearer at
SIT 229.10 (EUR 0.96) a litre.
The prices were raised in line with the government petrol pricing model, which monitors
prices of crude oil over the last month and adjusts petrol prices accordingly.
The Iranian nuclear standoff and the start of the driving season in the Northern Hemisphere
have fuelled the recent increase in the prices of crude oil. Meanwhile, the dollar's decline to
the euro in the last month prevented an even bigger price increase.
Apart from the two most widely sold sorts, prices of premium unleaded and heating oil also
went up: the former by SIT 12.1 to SIT 239.2 (EUR 1) and the latter by SIT 5.6 to SIT 150.1
(EUR 0.63).
Meanwhile, a leading economists has said the price hike is unlikely to endanger Slovenia's
fulfilment of the inflation criterion for eurozone membership given that there are no major
increases in the near future.
France Krizanic, the chair of the Economics Institute at the Ljubljana Faculty of Law, said
that while the price spike is expected to have an impact on inflation, it should not derail
Slovenia's efforts to stay within the euro-compatible band for now.
However, if the Iranian crisis turns out to be long lasting and if there are more jumps in the
price of crude oil, the government should consider altering the petrol pricing model to avoid a
bigger impact on inflation, he added.
Krizanic believes that prices should be adjusted quarterly and the two main Slovenian fuel
retailers forced to buy petrol on the futures market.
LJSE Lively in March
The Ljubljana Stock Exchange (LJSE) was quite busy in March, with regular deals amounting
to SIT 16.2bn (EUR 57.6m), up 12.3% over the year before
The Ljubljana Stock Exchange (LJSE) was quite busy in March, with regular deals amounting
to SIT 16.2bn (EUR 57.6m), up 12.3% over the year before. Brokers additionally concluded
block deals worth SIT 28bn (EUR 116.9m), according to the monthly report of the LJSE.
Despite solid volumes, the main market SBI 20 index was down 2.4% on the month before for
a cumulative loss of 8.6% over the 12 months to March. The PIX investment fund index was
only just positive with a gain of 0.3%, with the bond BIO index shedding 1.6%.
Only four of the 26 shares on the official market closed higher on the month before. The only
major winners, though, were drug maker Krka, which added 7.56%, and food company Droga
Kolinska, which was up 3.75%.
On the losing side, holding Istrabenz shed 10.88%, conglomerate Sava was down 7.78% and
publisher Delo lost 6.88%.
Krka was also by far the most heavily traded security, with deals worth SIT 4.9bn (EUR
20.45m), followed by oil company Petrol (SIT 1.5bn/EUR 6.3m) and retailer Mercator (SIT
690m/EUR 2.9m).
11
The market capitalisation of all securities was at SIT 1,621.8bn (EUR 6.77bn), with regular
shares accounting for just over 50%, followed by bonds (45.6%) and investment funds
(4.35%).
Barring investment funds, the LJSE market capitalisation was equal to 24.1% of 2005 GDP.
KAD Posts Bumper Profits for 2005
The state-run Pension Fund Management (KAD) posted a net profit of SIT 15bn (EUR 62.6m)
for 2005
The state-run Pension Fund Management (KAD) posted a net profit of SIT 15bn (EUR
62.6m) for 2005, according to unaudited results reviewed by the supervisory board on
Tuesday, 11 April.
The supervisors have labelled last year's performance as successful, as KAD remains the
biggest manager of supplementary pension insurance in Slovenia, the KAD press release
reads.
KAD last year managed pension funds in excess of SIT 120bn (EUR 500m), whereby
monthly payments of premiums exceed SIT 2bn (EUR 8.3m).
The management board informed supervisors about plans for 2006, including preparations for
a transformation into a financial group.
As part of the transformation, KAD is to offload minor stakes that have no growth potential.
Financial Conference Focusing on Euro and Capital Markets
The anticipated changeover to the euro in Slovenia and topical developments on Slovenia's
capital market topped the agenda of the first day of the Capital 2006 financial days
The anticipated changeover to the euro in Slovenia and topical developments on Slovenia's
capital market topped the agenda of the first day of the Capital 2006 financial days.
Opening the two-day event in Ljubljana on Wednesday, 12 April, chairman of the Ljubljana
Stock Exchange (LJSE) Marko Simoneti said that the conference was a chance for the biggest
Slovenian companies to present themselves and meet with investors.
Such events are a welcome development for the Slovenian capital market, Simoneti said,
adding that companies should be aware that they should not merely be selling their products
but also promoting financial instruments with which they can raise capital to help them grow.
According to Simoneti, in the absence of real portfolio investors in the Slovenian market, the
LJSE is looking to find investors who could influence the price of shares on the market on a
daily basis.
Srecko Pirtovsek, the editor-in-chief of the financial monthly Kapital, which is organising the
event, stressed that the event comes at the right time, since the LJSE is "in" again.
Apart from the opening addresses, the morning session of the event saw the presentation of
nine Slovenian blue chips.
The highlight of the afternoon session was the presentation of the awards for best manager
and financial expert, which saw former chairman of retailer Mercator Zoran Jankovic grab the
spotlight.
Jankovic, who was ousted by the Mercator supervisory board late last year in a move many
thought to be political, was voted best manager by his peers.
Surprised by his selection, Jankovic said: "I wonder how the supervisors of Mercator feel
now".
Meanwhile, chairman of pharma company Krka Joze Colaric was selected best manager by
Slovenian journalists.
The awards for best financial expert went to Bank of Slovenian governor Mitja Gaspari
(selected by peers) and Bank Austria Creditanstalt Ljubljana chairman France Arhar (selected
by journalists).
12
Euro Switch Preparations Proceeding as Planned at NLB
The head of the euro switch project Savo Dinjaski told the press that most of some 200 IT
applications have already been updated and testing them has yielded positive results
The preparations for the changeover to the euro in 2007 are proceeding as planned at
Slovenia's largest bank, Nova Ljubljanska banka (NLB), the head of the euro switch project
Savo Dinjaski has said.
Dinjaski told the press on Thursday, 13 April that most of some 200 IT applications have
already been updated and testing them has yielded positive results.
The bank expects cash-related logistics as the hardest nut to crack, as it will have to put euros
into some 850 cash machines, as well as replace the 50 that cannot handle euros, he revealed.
NLB will moreover purchase automatic coin and banknote counters, safes, deposit boxes and
four new armoured vehicles, he said.
Dinjaski pointed out that the bank will automatically convert the accounts and contracts of its
customers to euros.
NLB will begin exchanging tolars into euros from 1 December onwards, when it will brings
its exchange rate in line with the fixed tolar-euro one, he added.
Government Appoints Ivan Simic Head of Tax Administration
Simic, who was put forward by the Finance Ministry, was appointed for a period of five years
with the possibility for an extension
The government Ivan Simic the director of the Tax Administration (DURS), thereby
upgrading his status from acting director to full-fledged director, Finance Minister Andrej
Bajuk said after the cabinet's session on Thursday, 13 April.
Simic, who was put forward by the Finance Ministry, was appointed for a period of five years
with the possibility for an extension, Bajuk told the press.
The ministry put out a tender for the position in early February, with Simic being the only
person to apply.
Simic has been working as a tax adviser for over 17 years and is currently concluding his
master's degree studies at the Maribor Faculty of Law. He co-founded the Slovenian Tax
Advisers' Association in 1993.
Simic replaced former DURS director Zvezdana Grzina, who was dismissed by the
government in mid-December 2005.
Ljubljana Stock Exchange
The SBI 20 benchmark index ended the week at 4,757.40 points
Shares of retailer Mercator cooled off last week to drag the SBI 20 benchmark index 44.87
points (0.93%) lower on the week to 4,757.40 points.
After a blistering performance the week before, Mercator slumped in the absence of new
information that could support its price above the recent acquisition bid by a British fund.
In the end, the share dropped 6.7% to SIT 41,073 (EUR 171.39), to stay just above the price
offered by British firm Altima Partners in its bid for nearly 25% of the company.
However, analysts believe the revelation on Friday, 14 April that Mercator intends to enter
into a strategic partnership with Serbian retailer Rodic M&B of Novi Sad as part of its
expansion drive in SE Europe could spark a renewed buying frenzy after the Easter holidays.
Mercator shares topped the action on the Ljubljana Stock Exchange last week, generating SIT
3.89bn (EUR 16.23m) in turnover, which is over a quarter of all volumes (SIT 12.5bn/EUR
52.16m).
Although Mercator managed to pull down the rest of the market on 10 and 11 April, other big
names managed to buck the trend in the latter stages of the week.
13
Pharma company Krka thus managed to continue its recent surge, ending the week 0.91%
higher at SIT 138,677 (EUR 578.69). Fuel retailer Petrol also gained ground, adding 0.75% to
SIT 73,482 (EUR 306.64).
Mercator's slide also had an impact on the big name-heavy SBI TOP index, which closed the
week down 8.53 points (0.78%) at 1,079.49.
Meanwhile, popular investment funds were on the end of an emphatic round of profit-taking
that pushed the PIX investment fund index 147.99 points (3.64%) lower to 3,912.38 points.
The BIO bond index ended the week 0.24 points (0.2%) higher at 119.50.
Foreign Exchange
Mean exchange rate of the Bank of Slovenia
Euro (EUR) - SIT 239.59 (+0.00)
U.S. dollar (USD) - SIT 198.01 (+1.34)
Swiss franc (CHF) - SIT 152.54 (+0.55)
British pound (GBP) - SIT 346.98 (+2.89)
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REGIONAL INFORMATION
Western Slovenia Ski Resort Voted Best for 2005/2006
Cerkno, a ski resort in western Slovenia, was selected the best big ski resort of the 2005/2006
season in a poll conducted by a morning show on public broadcaster TV Slovenija
Cerkno, a ski resort in western Slovenia, was selected the best big ski resort of the 2005/2006
season in a poll conducted by a morning show on public broadcaster TV Slovenija.
Cerkno got 4,416 votes from viewers of the "Dobro jutro, Slovenija" (Good Morning
Slovenia) show in the category of big ski resorts, beating out the central Slovenian resort of
Krvavec (4,115 votes) and Maribor's Pohorje resort (3,611).
Meanwhile, among medium-sized resorts, the Kope resort near the city of Maribor in the
northeast took top honours, while Celjska koca near the eastern Slovenian city of Celje was
voted best small ski resort.
More than 25 Slovenian ski resorts were included in the poll that saw more than 36,000 votes
cast by viewers of the TV Slovenija morning show and listeners of a number of local radio
stations.
The awards were conferred on Tuesday, 11 April at a ceremony staged in the spa resort town
of Rogaska Slatina.
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BRANCH INFORMATION
Transport Ministers Sees Motorways, Railroads as Priority
The completion of the Slovenian motorway and railroad network is of key importance for the
country, as the 5th and 10th cross-European transport routes cross Slovenia
The completion of the Slovenian motorway and railroad network is of key importance for the
country, as the 5th and 10th cross-European transport routes cross Slovenia, Minister of
Transport Janez Bozic has said in Koper.
Bozic, speaking on Monday, 10 April at a meeting of a club of entrepreneurs from the
Slovenian Istria, added that finishing constructing the motorways is scheduled for 2008. He
also revealed that almost half of the country's regional roads are in a disastrous state.
A draft resolution on transport policy, presented in early March, aims at a smooth and
environmentally friendly transport of goods and people in the country, he said, adding that
Slovenia will earmark EUR 18bn until 2023 for road infrastructure.
Bozic pointed out that the priority tasks regarding road construction in the Primorsko region
would be the completion of the Rebernice dual carriageway section between Razdrto and
Podnanos (SW), which should be finished by the end of 2007.
The end of this year's tourist season will moreover see the beginning of the construction of a
dual carriageway tunnel between Koper and Izola (SW).
Meanwhile, the overhaul of the only railroad track between the port of Koper and the Divaca
transport hub will begin in 2006 and end in 2008, the year when the construction of a modern
dual track rail line between the Koper and Divaca is slated to begin.
The transport minister believes that the EU's wishes for a high-speed railroad track along the
Slovenian section of the 5th route are unfeasible, given that the terrain only allows for an
average train speed of 160 km/h through the country.
Bozic revealed that he is in favour of the modernisation of the first terminal as well as a
construction of the third terminal in the country's only port, while a recently launched
construction of a nearby road would link the port with the A3 Razdrto-Koper motorway.
A bill on state guarantees which in the works will speed-up the construction, Bozic believes.
The country needs SIT 130bn (EUR 542.58m) for road infrastructure projects, especially
those co-financed by the EU.
Security Important for Tourism, Official Says
The head of the Slovenian Tourism Association (TZS) Marjan Rozic spoke at a meeting on
global security and tourism in Slovenia
Security is an important factor in tourism, as it is impossible to develop the sector without
security, the head of the Slovenian Tourism Association (TZS) Marjan Rozic said on
Thursday, 13 April.
Rozic, speaking at a meeting on global security and tourism in Slovenia, added that tourism
and peace are inseparable, therefore security services form a part of tourism.
Tourists want safety, friendliness, mutual understanding, respect of human rights and a feeling
of being wanted, which they should already be able to feel on entering the country, he said at
a meeting organised by the National Council and the Interior Ministry.
"Tourism in Slovenia is growing - every year the number of tourists increases, which proves
that Slovenia is a safe and therefore an inviting tourist destination," he pointed out.
Marjan Hribar, the director of the Tourism Directorate at the Economics Ministry, meanwhile,
stressed the need to set up a round-the-clock information network for tourists.
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Marjan Miklavcic of the Defence Ministry said that tourism is the world's leading economic
branch, with Slovenia also putting tourism development as a strategic goal in its upcoming
tourism strategy.
17
COMPANIES
Logistics Company Buys EUR 2.1m Worth of Vehicles
The CEO of the Koper-based logistics group explained that they have purchased trailers
specially designed for household appliances transport, which can, however, be easily
modified to transport other types of cargo as well
Intereuropa Transport, a subsidiary of logistics group Intereuropa, has bought 17 new
commercial vehicles worth EUR 2.1m, Intereuropa CEO Andrej Lovsin said on Monday, 10
April.
The CEO of the Koper-based logistics group explained that they have purchased trailers
specially designed for household appliances transport, which can, however, be easily
modified to transport other types of cargo as well.
He pointed out that this purchase makes Intereuropa "the first company on the logistics
market with such a type of trailer," adding that this would enable the company to retain its
competitive edge.
The presentation of new vehicles was also attended by Transport Minister Janez Bozic.
Mozina and Vasle Nominees for TV and Radio Directors
The director general of public radio and TV broadcaster RTV Slovenija Anton Guzej has
nominated journalist Joze Mozina a new director of TV Slovenija and Vinko Vasle a director
of Radio Slovenija
The director general of public radio and TV broadcaster RTV Slovenija Anton Guzej has
nominated journalist Joze Mozina a new director of TV Slovenija and Vinko Vasle a director
of Radio Slovenija.
Mozina and Vasle's bids were presented at a session of the RTV Slovenija's Programming
Council on Tuesday, 11 April, which was expected to give its opinion on their appointments.
However, passing the opinion was put off until 18 April because most of the councillors
received the nominations on 11 April instead of at least eight days before the session, as set
down by the Council's statute.
A journalist at TV Slovenija, Mozina is a two-time recipient of the Josip Jurcic Award,
conferred by the namesake fund on journalists who pursue truth, for his documentaries on
mass executions by Slovenian resistance during and after WWII.
Vasle, a former journalist of the daily Delo and the weekly Mag, is currently assistant editorin-chief of the women's magazine Jana.
Mozina's competition included TV Slovenija programming director Mojca Menart, former
sports editor Marjan Lah and producer Matjaz Mihelcic.
Vasle applied for the post together with Radio Slovenija director Miha Lampreht, former
Radio Slovenija director Andrej Rot and journalists Biserka Povse Tasic and Janez Gasperlin.
Both directors are appointed for a four-year term by the general director, who however is not
obliged to take into account the Council's opinion.
Transmontagne Purchases ATC Kanin Debts
French company Transmontagne and Regional Policy Minister Ivan Zagar signed a contract
on the purchase of the claims the state and two banks have towards ATC Kanin, the company
managing the NW Alpine ski centre of Kanin
French company Transmontagne and Regional Policy Minister Ivan Zagar signed on Tuesday,
11 April a contract on the purchase of the claims the state and two banks have towards ATC
Kanin, the company managing the NW Alpine ski centre of Kanin.
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With the EUR 750,000 deal, Transmontagne bought the claims of the state and two of
Slovenia's largest banks, Nova Kreditna bank Maribor (NKBM) and Abanka Vipa.
In turn the French company intends to convert the debts into an ownership stake, thereby
raising its share in ATC Kanin from 14% to 53% by the summer.
Transmontagne president and general director Phillippe Gausset said that the deal gives the
company an opportunity to invest in other projects together with the local municipality, as
cooperating with local communities is one of the its main strategies.
Talks on the purchase of the 28% share of the state-run Restitution Fund (SOD) in ATC
Kanin are also underway, with the contract expected to be signed soon, he said.
Gausset is moreover convinced that a good tourism project in the region will be launched
soon, also in cooperation with Italy, which could triple the total length of the pistes to 40 km,
and also triple the number of visitors at ATC Kanin.
Zagar meanwhile said that the agreement with a strategic investor is a huge step toward the
development of the ski resort Kanin, the Bovec municipality and the entire region.
Bovec and the surrounding municipalities have, according to Zagar, numerous projects ready,
for which he hopes to find suitable strategic partners, and draw European funds in the next
financial period.
According to Bovec Mayor Danijel Krivec, Kanin finally got a new ski lift after 30 years and
after three years of negotiations with Transmontagne.
He added that Italy is to conclude this year its part of the joint project of connecting ski
resorts on both sides of the border, while another project for the construction of tourism
infrastructure in the valley is underway, to be finished in 2007.
ATC Kanin director Ales Ursic said that this season was better than the previous one, as the
number of visitors doubled despite bad weather conditions over the weekends. However, he
feels further investments are needed.
Delo Gradually Getting New Editorial Board
Delo Editor-in-chief Peter Jancic has confirmed for STA that he has started to appoint new
editors two months into his term as the content boss of Slovenia's leading broadsheet
Delo Editor-in-chief Peter Jancic has confirmed for STA that he has started to appoint new
editors two months into his term as the content boss of Slovenia's leading broadsheet.
Jancic revealed on Tuesday, 11 April that he has already decided that Ervin Hladnik Milharcic
would no longer be the editor of the high-profile Sobotna priloga (Saturday Supplement). The
former Delo correspondent from the US will stay on until 1 May, said Jancic, who has not yet
decided on a successor.
The Saturday Supplement is best known for critical analysis and comments of current events,
and high-profile interviews.
Jancic also confirmed that his predecessor, Darijan Kosir, would be deputy editor-in-chief and
the editor of business and economy.
Primoz Zrnec has been named the head of the metro section, while other appointments are yet
to be made.
Jancic became the editor-in-chief at the end of February despite opposition from journalists,
whose opinion is non-binding.
Altima Considers Mercator Long-Term Investment
The London-based financial firm Altima Partners, which launched a bid to acquire nearly a
quarter of Slovenian grocer Mercator, has said it considers this to be a long-term investment
The London-based financial firm Altima Partners, which launched a bid to acquire nearly a
quarter of Slovenian grocer Mercator, has said it considers this to be a long-term investment.
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Visiting the British Embassy in Ljubljana on Tuesday, 11 April, representatives of Altima
explained that they have no intention of raising their bid of SIT 41,000 per share (EUR
171.09) at this time, Slovenian electronic media reported.
"It's a very early stage; the offer has only been in the market for a few days. It has a number of
weeks to run. At this time we have no intention to raise the offer," Mark Donegan of Altima
told public broadcaster TV Slovenija.
"My success is 24.99%. We think that is achievable; we think that we have made a fair offer,"
Donegan added for TV Slovenija.
Altima representatives said that if the fund's bid was successful, they would like to meet
representatives of Mercator's two-largest owners, the Istrabenz holding and beverage group
Pivovarna Lasko. Altima would also be looking to work with other Mercator shareholders,
Donegan said.
Donegan denied that Altima had any agreement with former Mercator chairman Zoran
Jankovic or links to Serbian or Russian capital.
Mercator Supervisors not Happy with Company's 2005 Performance
The supervisory board of Slovenia's largest retailer Mercator has established that, while the
management has improved the company's operations in several areas in 2005, it has spent
substantially more means than planned
The supervisory board of Slovenia's largest retailer Mercator has established that, while the
management has improved the company's operations in several areas in 2005, it has spent
substantially more means than planned.
At its session, on Tuesday, 11 April, the supervisors concluded that some of the company's
investments were probably not considered well enough, Mercator said on Wednesday, 12
April.
The board believes that including the subsidiaries and assets of retail chain Era in Croatia into
the Mercator group in 2005 caused a loss of SIT 5.6bn (EUR 23.36m), therefore, it has
labelled 2005 as less successful.
They moreover confirmed the management's proposal to up the dividend to SIT 600 (EUR
2.5) per share, SIT 282 (EUR 1.17) more than last year.
The supervisors also got acquainted with the resignation of its deputy chairman Gorazd Cuk.
The Mercator group generated SIT 419bn (EUR 1.74bn) in 2005, up 11.2% in comparison
with 2004 and 9.3% above plans.
Its net profit meanwhile dropped by 16.5% to SIT 5.6bn (EUR 23.36m), 8.7% below plans.
CEO Says Mercator to Talk with Retailers in the Balkans
The management of Slovenia's largest retailer, Mercator, is preparing for talks with retailers
in Croatia and Serbia-Montenegro on possible tie-ups, CEO Ziga Debeljak told the latest
issue of the weekly Mag
The management of Slovenia's largest retailer, Mercator, is preparing for talks with retailers in
Croatia and Serbia-Montenegro on possible tie-ups, CEO Ziga Debeljak told the latest issue
of the weekly Mag.
"Mercator is currently holding talks on possible options with various partners," Debeljak said,
adding that they have so far not entered into any negotiations.
There are no representatives of Mercator's largest owners in the team that is doing the talks,
he told the weekly.
Debeljak also sees Serbian retailer Delta Holding as a suitable partner in pursuing Mercator's
expansion strategy.
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He also told the weekly that he has no plans to sell his 1,100 Mercator shares, which he
acquired in 1999 at SIT 9,000 (EUR 37.56) a share, to the British Altima fund at SIT 41,000
(EUR 171.08) a share.
"People employed in management should have some of the company's shares...I do not know
why I should sell them to a fund based at the Cayman Islands and at a below-market price,"
he added.
Mercator is currently owned by companies with long-term management goals, which support
the company's development plans, Debeljak believes.
Hit Opens New Gaming Parlour
Slovenia's largest gaming chain Hit opened a new gaming parlour near the Vrtojba border
crossing with Italy
Slovenia's largest gaming chain Hit opened a new gaming parlour near the Vrtojba border
crossing with Italy on Wednesday, 12 April. The project that cost Hit SIT 1bn (EUR 4.2m)
will create 35 jobs, the company said in a press release.
The new casino, dubbed "Casino Drive-in" because of its American 1960s look, will offer 175
slot machines and will operate round the clock.
The new addition is Hit's second gaming saloon. However, the company also owns four large
gaming and entertainment centres, two casinos and several hotels in the city of Nova Gorica
and in the Alpine resort of Kranjska Gora.
Mercator CEO Comments on Possible Tie-Ups with Petrol
Ziga Debeljak, CEO of retailer Mercator, has said that Mercator is in talks on possible
strategic links with the country's largest fuel trader Petrol, however they do not plan to enter
into partnership
Ziga Debeljak, CEO of retailer Mercator, has said that Mercator is in talks on possible
strategic links with the country's largest fuel trader Petrol, however they do not plan to enter
into partnership.
Debeljak told the press on Thursday, 13 April that the companies could improve joint
acquisition procedures and carry out reciprocal purchases, whereby Petrol would buy the
products for its retail chain of petrol stations from Mercator, while Mercator would buy fuel at
Petrol.
Debeljak also repeated that the company's management is currently holding only preliminary
talks on possible partnerships with retailers, however, no deals have been arrived at yet.
Debeljak wants Mercator's owners to approve the management's plan on purchasing an
additional 10% of its own shares at the annual general meeting scheduled for 16 May. These
shares could then be exchanged with a possible strategic partner, he revealed.
At the AGM, the management also wants to get the go-ahead to increase Mercator's share
capital by 50% in the next five years, which would be used for the retailer's expansion outside
of Slovenia.
Slovenia Notifies Neighbours about Mura Hydro Plants
Croatia and Hungary have been informed about Slovenia's intentions to build hydro power
stations on the Mura river in the northeast, and at the same time set up a balanced ecosystem
there, the Environment and Spatial Planning Ministry said
Croatia and Hungary have been informed about Slovenia's intentions to build hydro power
stations on the Mura river in the northeast, and at the same time set up a balanced ecosystem
there, the Environment and Spatial Planning Ministry said on Thursday, 13 April.
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The ministry has sent a letter to the Croatian and Hungarian representatives of the SlovenianCroatian and Slovenian-Hungarian commissions for water economy, informing them about
Slovenia's plans in line with a consensus reached with Austria.
Croatia and Hungary will be informed about the possible launch of formal procedures in
accordance with international agreements and conventions, and within the international
commission for the Sava river basin, the ministry added.
Meanwhile, the head of the Slovenian-Austrian commission for the Mura river, Tomaz
Globokar, proposed that at its next session, the commission looks into the possibility of
building hydro power plants on Mura.
The initiative has been launched by the power company Dravske elektrarne, owned by
Slovenia's largest power producer, HSE, which has received a licence for the construction of
the hydro power stations on the Mura.
Delo Supervisors Appoint Mitja Pleterski to Management Board
Pleterski, who will be responsible for marketing and finance, will replace current
management board members Natasa Suklje Velkavrh and Matija Vojska
The supervisory board of newspaper publisher Delo appointed Mitja Pleterski to the
management board for a five-year term on Thursday, 13 April.
Pleterski, who will be responsible for marketing and finance, will replace current management
board members Natasa Suklje Velkavrh and Matija Vojska.
Delo's management board will consist of two members, CEO Danilo Slivnik and Pleterski,
who was previously employed at the Slovenian subsidiary of Germany's Siemens.
"Appointing the second member of the management will allow it to pursue its goals," chief
supervisor Boris Zupancic said.
Government Adopts Development Programme for Lipica Stud Farm
The cabinet adopted a program on safeguarding and developing the Lipica stud farm for the
2006-2010 period
The cabinet adopted a program on safeguarding and developing the Lipica stud farm for the
2006-2010 period as it met at a regular weekly session on Thursday, 13 April.
The document, drafted by the Culture Ministry, will allow the most urgent organisational and
investment measures to be implemented in Lipica, government spokesperson Valentin
Hajdinjak told the press after the session.
It will also allow the functioning of the public institution until the amendments to the act on
Lipica are passed.
The act would allow performing the public function of the institute without holding back the
economic activities at the home of the world-famous Lipizzaner horses.
The programme will moreover serve as a basis for completing the national spatial plan as well
as enable the implementation of programmes which will be carried out in 2006 with the aid of
European funds.
Among such projects, the ministry mentions the establishment of a Lipizzaner museum, the
adaptation of the golf course and the clearing of grazing meadows.
Istrabenz Publishes Takeover Bid for Droga Kolinska
In the bid which is valid through 12 May, Istrabenz offers SIT 2,450 (EUR 10.23) per share
for the remaining shares
Istrabenz holding published on Friday, 14 April a takeover bid for the food company Droga
Kolinska, in which it already holds a 55.63% stake.
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In the bid which is valid through 12 May, Istrabenz offers SIT 2,450 (EUR 10.23) per share
for the remaining shares, which is how much Droga Kolinska's share was worth on Thursday,
13 April.
The bidder however did not set down the smallest number of shares which would have to be
purchased for the bid, which was published by the brokerage firm Publikum, to be successful.
Istrabenz moreover reserves the right to purchase Droga Kolinska's shares directly or
indirectly through a third party, however, not under more favourable conditions than stated in
the bid.
The Koper-based company said it was unaware of whether the second and third largest
owners of Droga Kolinska, investment firms Maksima Holding and Poteza Nalozbe, will
accept its offer.
Istrabenz announced its takeover plans in mid March, with the company's CEO Igor Bavcar
explaining that a takeover was a logical step after the successful purchase of Kolinska and its
merger with Droga last year.
Mercator Counting on Serbian Partner for Balkan Expansion
Slovenia's largest retailer, Mercator, intends to enter into a strategic partnership with
Serbian retailer Rodic M&B of Novi Sad as part of its expansion drive in SE Europe
Slovenia's largest retailer, Mercator, intends to enter into a strategic partnership with Serbian
retailer Rodic M&B of Novi Sad as part of its expansion drive in SE Europe.
Mercator and Rodic M&B signed a letter of intent on Friday, 14 April on a strategic
partnership with which the two companies would become "important" shareholders of each
other.
As part of the partnership, Mercator is to expand its retail chain in Serbia-Montenegro through
Rodic M&B, Mercator said in a press release on Friday, 14 April.
The press release says that Mercator's goal is to use the strategic partnership to continue its
expansion in SE Europe in a bid to become the leading retailer in the region.
"Mercator is convinced that a strategic partnership of this kind can be an important
contribution to its retail operations in SE Europe and a positive example of business
cooperation in SE Europe," the press release states.
According to Mercator, the letter of intent sets down all the details that would lead to the
prompt realisation of the partnership.
Rodic M&B is one of the biggest grocers in Serbia-Montenegro. It anticipates to generate
revenues of EUR 370m this year.
Small Mercator Shareholders United in Talks with Altima
The Association of Small Shareholders formed a negotiating team for talks with British fund
Altima in order to achieve a maximum selling price for their stakes in retailer Mercator
At its session on Thursday, 13 April, the Association of Small Shareholders formed a
negotiating team for talks with British fund Altima in order to achieve a maximum selling
price for their stakes in retailer Mercator.
The association said on Friday, 14 April that it has agreed to start talks with Altima, which
published a bid to acquire 24.99% of Mercator in early April.
They also called on all Mercator's small shareholders to join the association as only a joint
approach can result in the maximum price for their stake.
Altima is currently offering SIT 41,000 (EUR 171.13) per Mercator share. Its bid runs out on
28 April at noon.
23
SLOVENIA IN BRIEF
Social Partners Discuss Technological Development and Growth
Representatives of the employers, trade unions and government managed to largely close the
chapters on facilitating investment in R&D and on the competitive economy and growth as
they met for talks on the 2006-2009 social agreement on Monday, 10 April. However, several
issues remained open, namely profit sharing and worker shareholdings well as the issue of
investment in technological development. The social partners are scheduled to meet next in
two weeks' time to discuss the chapters on employment and the labour market.
Slovenia-Russia Association Celebrates 10 Years
The Slovenia-Russia Association, a body promoting bilateral ties between the countries, held
a ceremony in Ljubljana on Monday, 10 April to celebrate 10 years since its inception.
Addressing the ceremony, the association's chair Sasa Gerzina said that the two countries
were created in similar circumstances.
Slovenia to Celebrate Books
Several cities across Slovenia will be holding Slovenian Book Days, an annual festival that
promotes reading, over the next week. The 11th book festival will begin on Tuesday, 18 April
in Ljubljana's Zvezda Park. Apart from 66 Slovenian book publishers and book shops, Zvezda
Park, the festival's central venue, will also be hosting a number of acclaimed music
performers and writers, mostly Slovenian but also several guests from Croatia. Through 22
April, book stalls and performances will also be attracting crowds in Maribor, Velenje, Celje
and Koper.
Journalist Joze Hudecek Receives Lifetime Achievement Award
Journalist, editor and critic Joze Hudecek received the lifetime achievement award as the
Slovenian Association of Journalists conferred its annual Consortium Veritatis (Brotherhood
of Truth) awards in Ljubljana on Thursday, 13 April. As the award panel explained its choice,
Hudecek has in his 40-year career marked Slovenian journalism with numerous shows,
documentaries and interviews, including with French existentialist Jean-Paul Sartre and US
playwright Arthur Miller.
Rupel and Austrian Ambassador on Slovenian Minority
FM Dimitrij Rupel met Austrian Ambassador Valentin Inzko on Friday, 14 April to discuss
the situation of the Slovenian minority in Austria.
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