The shareholders’ meeting of the “Dr. Simo Milošević” Institute did not reach a decision on the Restructuring Plan yesterday, as an agreement between the Government and Žarko Rakčević, the co-owner of HTP Vila Oliva, the largest minority shareholder of the Institute, was reached. As a result, the Plan needs to be revised. Following the meeting, Rakčević told Pobjeda that he hoped the agreement between the partners had been achieved and believed that the risk of bankruptcy had been avoided for the second time. He expects that no residential buildings will be constructed on the Institute’s land, that the first phase will remain in the Institute’s ownership, and that ownership issues related to the land will be resolved.
The conclusions shared by the Government and Rakčević, as communicated by the Institute’s executive director, Dr. Zoran Kovačević, state:
- The documents and materials discussed at the shareholders’ meeting will be further amended and aligned with the agreement reached. Therefore, the shareholders will not vote on them at this session.
- The revised Restructuring Plan will be considered at the next extraordinary shareholders’ meeting, which will be convened as soon as possible to ensure that all shareholders are informed in a timely manner.
Majda Adžović, the Secretary of the Ministry of Spatial Planning, Urbanism, and State Property, stated that the University will need some time to make the necessary changes to the documents. She emphasized that Vila Oliva will remain a partner in the Institute and will work with the Government on its further development.
“Institute Igalo will not go bankrupt, nor will it close. It will continue to operate, hopefully with the successful implementation of the Restructuring Plan in the coming period, aiming to raise the Institute to a four-star level while providing rehabilitation services to the citizens of Montenegro,” said Adžović.
Petar Rakčević, a representative of HTP Vila Oliva, mentioned that after the first shareholders’ meeting, they had intensive negotiations with Government representatives regarding objections to the Plan. He stated that the Government shares their view on several disputed points, including the disagreement over the sale of the first phase of the Institute, the need to convert the land use rights into ownership rights for land that could only be used for health or commercial tourism, and the reduction in the projected costs for the Institute’s reconstruction. The only aspect they accept is the sale of the Children’s Department, but only for the purpose of building a school in Igalo.
Commenting on yesterday’s shareholders’ meeting, Žarko Rakčević, co-owner of Vila Oliva, who did not attend, told Pobjeda that he hoped an agreement had been reached between the partners and believed the risk of bankruptcy had been avoided for the second time. The first time, they prevented bankruptcy through a loan of five million euros. When asked if the money had been repaid, Rakčević stated that it had not been, but “he had no intention of activating the mortgage.”
“The agreement was that the funds would be repaid by the end of January, as it was an interest-free loan. However, that deadline will be extended because I believe in the Institute’s project, which can be beneficial to the citizens while also being profitable. But we need to be good stewards,” said Rakčević.
They are prepared, Rakčević added, to cover part of the losses, in proportion to their ownership stake.
“The outstanding losses of the Institute amount to about 21.5 million euros, and we are willing to cover losses up to seven million euros, for which I can honestly say we were not responsible,” Rakčević noted, adding that they had been outvoted when pointing out poor management practices.
He hopes that there will be no surprises and that the plan to avoid residential construction on the Institute’s land will be upheld, the first phase will remain under the Institute’s ownership, and the land ownership issue will be resolved.
“I believe that in the next few years, the Institute will make a strong comeback in the Western European market through a public tender and will act as a good host. We are very interested in ensuring that this process is monitored by commissions that will include representatives from Vila Oliva, as well as the public,” Rakčević said, adding that the program for 100,000 overnight stays for citizens through the Health Fund will continue, and the Institute will be gradually upgraded to a four-star level.
Rakčević also purchased 5,750 shares of the Institute at the stock exchange for 333,900 euros, honoring an agreement with a group of shareholders holding about 2% of the shares, based on whose authorizations they had two out of the five members on the Board of Directors.
“We have acted together in all crucial decisions, disagreements, and suggestions at both the shareholders’ meeting and the Board of Directors,” Rakčević said.
He added that the shareholders had agreed on the price of 58 euros per share, which is also mentioned in the Restructuring Plan, and that only a small number of shares from this group remain to be sold at the same price. As a result, Rakčević’s company’s stake in the Institute has increased to around 29%.
