Agrana stops negotiations about acquisition of Sunoko

The Austrian sugar, starch and fruit concern Agrana is putting a temporary halt on the negotiations about the takeover of the Serbian sugar manufacturer Sunoko, as reported by Beta and Tanjug.

On May 2, Agrana announced that an agreement was reached with the owner of the Serbian company Agri Europe Cyprus, Miodrag Kostic, about a temporary suspension of the negotiations, and the reason is the currently difficult situation in the European sugar market, Tanjug reports.

Kostic's MK Group confirmed for Beta that the negotiations about the deepening of the cooperation had been stopped, but added that the strategic cooperation will continue.

In mid-2016, Agrana announced that it wanted to take over a majority stake in Sunoko, aiming to increase the production of sugar, and the Commission for Protection of Competition gave permit to Agrana to take over Sunoko in March 2017, as it had determined that the sale would not jeopardize the competition in the market of production, buyout and processing of sugar beet and the production and wholesale of sugar derived from sugar beet in Serbia.

Sunoko owns sugar plants in Vrbas, Pecinci and Kovacica, and the company has a 74% share in the Serbian market with its annual production of nearly 300,000 tons of sugar.

As Beta reminds, the plan of MK Group was also to buy the remaining two sugar plants in Serbia owned by Greece's Hellenic Sugar, those in Zabalj and Crvenka, but, in order for this to be approved by the Commission for Protection of Competition, the company would have to sell a stake in one of the sugar plants.

Agrana is the regional leader in the production of sugar, and is a member of the biggest sugar manufacturer in Europe, Germany's Sudzucker. It operates in Austria, Bosnia and Herzegovina, Romania, Slovakia, the Czech Republic, Hungary and Serbia, where it has a share in the sale of sugar of under 1%.

According to Tanjug, this company expects losses of as much as 100 to 200 million euros in the business year 2018/19.

The market has been liberalized since October 1, whereby production quotas, guaranteed lowest prices and limits to import were abolished.

Furthermore, due to new bans on the use of certain neonicotinoids in the EU, this sector has suffered great losses in terms of yields, and farmers growing sugar beet in Austria are currently facing the problem of crop-destroying insect attacks.

Sunoko d.o.o. Novi Sad

AGRANA GRUPPE Wien

Agri Europe Cyprus

Sunoko Novi Sad

AGRANA GRUPPE Wien

production of sugar

production of starch

production of fruit concentrate

sugar

starch

fruit concentrate

Stefan Bittner

sugar plants in Serbia

Agri Europe Cyprus

Sudzucker

sugar market

MK Group

Miodrag Kostic