Croatian Government to sell up to 600 state-owned companies in the next two years

January 2013

According to press reports, the Croatian Government is planning to sell shares in 300 companies by the end of 2013 and in further 300 companies by the end of 2014. The income from the first round of sale is expected to reach HRK 3bn (approximately EUR 396m).

The state portfolio is divided in three categories. The first category covers companies of special state interest and the Government intends to retain a controlling shareholding (e.g. 25%+1 share). The most significant income from this group is supposed to come through the sale of Hrvatska poštanska banka (Croatian Postal Bank) and Croatia Osiguranje (largest Croatian insurance company). The Government has discussed privatization of these companies ever since taking office in 2011 and initial steps in the process have already been taken. Such privatization route is envisaged for some other major companies such as INA (national oil company), Jadrolinija (shipping), Luka Rijeka (port management) and Đuro Đaković (industrial machinery). The second category consists of companies proposed for recapitalization. Out of these companies only ACI (marinas management) received publicity up to this date.

The third category will reportedly cover companies that consistently produce losses and which should be fully privatized. The Government plans to offload all of its stakes in several hospitality/tourism companies (including hotel companies Medena, Maestral, Makarska, Korčula, Orebić) as well as in Borovo (footwear manufacturer), Tiskara Vjesnik (printing company) and Brijuni Rivijera (real estate development).