The ailing mechanical engineering group Djuro Djakovic from Slavonski Brod on Wednesday held a shareholders meeting which okayed the recapitalization required to sell 75 percent of the company to the Czech company DD Acquisition in a deal worth 200 million kuna (€27 million).

DD Acquisition were given a 30-day deadline to pay 100 million kuna (€13.3 million) to the group. During that period, state agency Hina added, an audit of their “non-financial investment,” estimated at more than 100 million kuna (€13.3 million) is to be completed.

“We have been operating without any access to bank loans or government funding since 2020. It is important that DD Acquisition makes the payment as soon as possible to ensure the company’s survival,” CEO of Djuro Djakovic Group, Hrvoje Kekez, was quoted as saying.

Kekez added that DD Acquisition’s vision for the company is to turn it into a leading European manufacturer of freight wagons. This means launching the production of new types of wagons, the likes of which have never been produced by Djuro Djakovic before.

“Due to the war in Ukraine, the demand for grain wagons is now expected to increase. In terms of labor needed, it is currently in short supply. Considering the investor’s plans for the coming years, I would say that there will be problems in ensuring a sufficient number of workers,” Kekez said.

DD Acquisition is expected to take over a 75-percent stake in Djuro Djakovic Group, with the Croatian government retaining close to 25 percent. Small shareholders will hold 0.2 percent of the company stock.

(€1 = 7.51 kuna)