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Creditors okay IKR-Agrofert deal

Creditor banks of financially troubled Hungarian agribusiness IKR Zrt have approved the transfer of part of the company's activities plus debt to the Czech Republic-registered company Agrofert, IKR chief executive Attila Szaxon said Monday evening.

Szaxon said CIB, Erste, K&H, MKB, OTP and Raiffeisen banks had endorsed splitting IKR into two companies.

The company's agribusiness-financing as well as fertilizer, pesticide and seed sales business will go to IKR Agrocentrum. That company will be taken over, together with IKR's debt and other obligations, by Agrofert. IKR will retain the company's agricultural-machinery sales and related services.

KR, which currently has HUF 15.5 billion in outstanding loans, had revenue of HUF 50 billion in 2010, down from HUF 94 billion in 2009 and HUF 120 billion in 2008.

Last year IKR controlled about a third of Hungary's agricultural-machinery market, one-third of the chemical-fertilizer market, 15% of the pesticide and herbicide market and 14% of the seed market.