Janez Bohorič is not abdicating, and Sava, which operates successful, does not need anybody to save it

The authors of the above-mentioned articles Janez Bohorič Abdicating Sava and Rescuing What Can be Rescued and Janez Bohorič Bids Farewell and Searches for Money, tried to show the position of Sava as a weak and difficult one and, repeatedly, they quoted untrue facts, which in the past we had rejected for several times already. In order to provide an impartial piece of information to the readers of Finance newspaper we wish to explain the facts.
1. A syndicated long-term loan, for which we are agreeing upon with the bank syndicate, is either not a “help project to the ally Stane Valant , or the friend Bine Kordež” as not named experts indicated in the article, and it is not about that “banks are no longer ready to reprogramme short-term loans” as concluded by the authors, and it is simply not true that “Sava blames banks for refinancing”. Sava decided to raise a long-term loan (and a simultaneous repayment of short-term loans) wishing to achieve a suitable maturity of finance sources. As explained in the answer to yesterday’s questions by the Finance journalist, banks require insurance with the company assets for hiring a long-term loan, therefore, Sava decided – thereby also taking into account commitments from the existing loan agreements – to join an organised consortium of banks in order to take care that all banks have their loans additionally insured with a part of Sava’s assets and that under the same conditions.
2. To be able to balance the maturity of our liabilities, we decided to issue long-term bonds last December, so it is not true that we decided to issue bonds in order to “save Valant”. Sava considers the loan to NFD Holding as a usual, profitable business, which according to our estimates and with regard to the insurances we obtained, is a safe business too.
3. It is simply not true that Sava values its share in Merkur “as twice as high as the estimated market value”. As already explained in the past, we obtained for the need of evaluating Merkur in our 2009 financial statements an up-dated evaluation of the Merkur share value, which is significantly higher than the value mentioned in Finance newspaper.
We should neither neglect the fact that Sava obtained the Merkur shares, which form the basis for “the exposure to Merfin” dealt with in the article, as an exchange for our subsidised trade company Sava Trade and that at prices, which were significantly lower that the price, at which the option contract with Merfin was concluded in 2008, and at which the sale of one half of these shares was realised at the end of 2009. The funds engaged on the part of Sava were thus significantly lower than €117 million as discussed in the article. The entire difference between the purchase price and the selling price is a potential profit for Sava.
4. It is not true that as you claim Sava “experiences financial difficulties in merging banks as it cannot rely on banks’ services to the extent wished for”. As already explained for several times to Finance journalists, the merger procedure did not halt, as the present report by the company Deloitte Svetovanje, which evaluated both banks in order to determine the exchange value, is still being dealt with by supervisory boards of both banks. It is true that after studying the evaluation of the exchange value by both supervisory boards, we will arrive at a point when shareholders in both banks will have to come to a conclusion whether they can reach harmony in expectations in view of the exchange value, or not.
Moreover, we cooperate with all banks and we “rely on their services” in the equal way, regardless of the fact whether we are a shareholder in a bank or not, so a possible halt in merging banks should, in no case, influence our “relying on banks’ services”.
5. All other speculations referring to Sava’s operations in the mentioned article are best denied with the Report about the operations and unaudited financial statements of Sava d.d. for 2009, which was announced on the SEOnet and Sava website on 25 February 2010. The Report about the operation of the Sava Group to be published at the end of March, will give the right picture of successful operations of the Sava Group.
6. The article quotes our answers to the questions by the journalist Monika Weiss in an abbreviated form, which in the context of the article changes their meaning, therefore, we are asking you to publish our yesterday’s answers to your questions in full.

1. When does the mandate of the chairman of the board of Sava expire?
2. Will Mr. Bohorič repeat the mandate; if the supervisory board members offer him to do that, will he accept (why NO/YES)?
2a. Does Mr. Bohorič maybe deliberate to leave prematurely?
2b. What are his plans after leaving (retirement, be a supervisory board member at Sava or an advisor)?
3. Who will take over the managing of Sava – is Mr. Miha Dolinar still the main candidate?
Answer to questions 1 to3:
The mandate of Janez Bohorič, Chairman of the Board of Management of Sava d.d., expires in July 2011. He does not think to finish it prematurely, and he also does not think about repeating it, even if the supervisory board members would offer him this option, as until that time the new management will be prepared and qualified to successfully proceed with the work of the present Board of Management.
He has not decided yet what he will do after the expiration of the mandate. This depends on the situation at that time as well as his condition of health.
When time comes, the Supervisory Board of Sava d.d. will decide about the proposal given by its HR commission as to who will succeed the present members of the Board of Management. This commission is obliged to consult the director of the competence centre HR, Law and Organisation as well as the Board of Management of Sava d.d. about the preparation of candidates for a new management.
4. Is it true that Sava tries to obtain (it is in the procedure of negotiations with the bank consortium) about €150 million of refinanced loans?
4a. In which phase are the discussions with the organiser of the consortium- NLB? When possibly will these agreements be completed?
5. With which projects the refinancing is bound and why is it necessary?
Answer to questions 4, 4a and 5:
Due to the aggravated business conditions and recommendations by the Bank of Slovenia in this recent period banks decide to approve loans only which are insured with the company assets. Considering such change in the business policy, Sava decided that in accordance with the provisions in the present loan agreements as well as in line with the good business practice, we join to the organisation of a creditor bank consortium to insure the existing Sava’s loan obligations. By doing so, we enable all banks to additionally insure the existing loans under the same conditions and in accordance with their requirements. We expect that agreements and procedures with NLB, which organises the consortium, and other banks will finish in March.
6. What is going on with the project of a tie-up between Abanka and Gorenjska Banka, which has been stagnant ever since last October?
As already told for several times, we at Sava are of opinion that merging both banks is reasonable in terms of the economy, therefore we support it. We believe that a merged bank would represent added value to all present stakeholders (shareholders, employees, business partners…) in both banks. The merging process has not been halted as you state in your question, as presently supervisory board of both banks are still studying the report prepared by the company Deloitte Svetovanje, which carried out evaluation of both banks in order to determine the exchange value. It is true, however, that after both supervisory board research the evaluation of exchange value we will arrive at a point when shareholders of both banks will have to decide whether they can harmonise their expectations with regard to the exchange value or not.
6a. Will Sava sell the stake in Abanka and will it,considering its present estimates, sell it shortly?
Sava is not selling the stake in Abanka Vipa but (as already stated in our answer to the preceding question) we will in the case that there will be no understanding reached as to the exchange value, repeatedly examine all opportunities we have. In accordance with our public communication policy we will inform you about our investment intentions after they are implemented.
7. Experts are confident that given the present ownership relations in Abanka the government will not allow a merger. How do you comment?
In discussion that so far we have had with the government representatives we have never perceived any disinclination to the merger of both banks, on the contrary, we received expression of explicit support to the project.
8. According to the unofficial information Sava should have a B plan, which is that a foreign partner would enter Gorenjska Banka as a minority owner, which would then submit a take-over offer for Abanka (or should the offer be given by the strengthened GB)? Have you already chosen your strategic partner?
At Sava we thoroughly examine our risk in every project and prepare an exit also for the case that the plan would not succeed. In this project, too, we have prepared various back-up scenarios, about which I cannot discuss, therefore, I am asking you for understanding for not answering your last question.

Any important changes to data in the company's prospectus shall be promptly released in public announcements on SEOnet of the Ljubljana Stock Exchange. This public release will also be available on-line at the address www.sava.si as of the day of the announcement for a period of 5 years.