New Owners and Old Connections: Management Buyouts, Banks, Business Networks and Judicially Proven Abuse in Post-Yugoslav Privatization

First: “tycoon” is not a legal category

Across the post-Yugoslav region, the label: tycoon came to be used for very wealthy businesspeople, rapid concentrations of ownership, managers who became majority owners of companies and business groups with alleged or actual political connections. But the term has no single legal definition. A person can be a major owner, politically well connected and the recipient of a large bank loan and still: commit no criminal offence. This article therefore uses the term only: as a historical-media label, not as a legal finding.

Evidentiary ladder for this article

To avoid mixing rumours, political allegations and judicially established facts, the article uses five levels. LEVEL 1 — documented business or ownership connection. Example: Examples include one company owning another, a bank financing a takeover, a manager belonging to a consortium, or shares being pledged as collateral. These are facts about business or ownership structure, not in themselves proof of corruption.

Such a connection therefore describes the structure of the transaction; legality or possible abuse requires additional evidence. LEVEL 2 — audit, regulatory or other official institutional finding. Example: At this level, relevant material can include a central bank finding on connected lending, an auditor identifying an irregularity, or an anti-corruption body criticising a procedure. This is more than rumour. It is still not necessarily: criminal liability. LEVEL 3 — indictment or formal criminal charge.

This means: the prosecution claims it has sufficient evidence for a court case. It does not mean: the accused is guilty. The presumption of innocence applies. LEVEL 4 — non-final or first-instance judgment. A court has found guilt, but an appellate court may: An appellate court may amend a first-instance judgment, quash it, or order a retrial, so that status must be stated explicitly in the article. It must therefore be labelled: first-instance / non-final.

LEVEL 5 — final judgment, guilty plea, or formal admission of responsibility in a judicial settlement. This is the strongest level used in this article. Even here, further procedures may remain possible: Even after finality, a particular case may still involve a constitutional complaint, proceedings before the European Court of Human Rights, or other extraordinary legal remedies. But within the ordinary national criminal process: guilt has been finally established or admitted. A management buyout is not a problem in itself.

A management buyout means that company management: purchases an ownership stake in the company it manages. This is a standard financial transaction in developed market economies as well. The problem arises if the financing structure means that the acquisition is funded almost entirely with debt, shares in the target company are pledged for the loan, the target company itself begins servicing debt created to finance its acquisition, related-party transactions are used and credit risk is not properly assessed. Credit expansion before the 2008 crisis was extremely strong.

The OECD later described Slovenia's pre-crisis model in terms of excessive credit growth, weak risk assessment, lax lending standards and a major role for state-owned banks[1]. The OECD assessed that weak governance of predominantly state-owned banks probably contributed to: misallocation of credit.[1] The IMF later used even stronger language: endemic connected lending and lax risk controls — widespread connected lending and weak risk controls, especially in state-owned banks.[2] This is an institutional diagnosis of the system. It is not a judgment that: every individual takeover was illegal.

Bank of Slovenia specifically examined management-buyout loans in 2009. In April 2009 the Bank of Slovenia publicly stated that banks in direct or indirect majority state ownership were conducting: audits of lending to the most exposed management buyouts.[3] At the same time it emphasized an important safeguard only after those audits would it be possible to determine precisely: possible violations, responsibility of management boards and responsibility of supervisory boards[3]. This is exactly the rule used by this article: a high-risk loan ≠ a criminal offence.

Merkur and Bine Kordež: from management buyout to guilty plea

Bine Kordež was chairman of Merkur's management board and one of the most visible actors in the company's management buyout. After years of criminal proceedings, at the end of 2015 he entered into an agreement with the Specialized State Prosecutor's Office and admitted:

• continued abuse of office;
• related alleged transactions.[4]

In 2016, on the basis of the agreement, he was sentenced to a total of: seven years and six months in prison.[5] Delo reported at sentencing that the agreement covered: 11 criminal offences and that Kordež was expected to act as a witness in other proceedings relating to disputed loans used to finance Merkur's management buyout.[5] What can we actually claim from this? We can state: Kordež pleaded guilty and was convicted. But we may not infer from that: all loans connected with the Merkur management buyout were criminal. The judicial finding concerns: specific acts and transactions.

Istrabenz: finally established money laundering arising from a share transaction. In 2019 Slovenia's Supreme Court rejected requests for protection of legality in the Istrabenz case.[6] Those finally convicted included Igor Bavčar, Kristjan Sušinski and Nastja Sušinski. The court found that in the sale of Istrabenz shares held by Pivovarna Laško, a profit of: EUR 25.21 million that should have gone to Pivovarna Laško instead accrued to the convicted persons or related persons and was then brought into the economic system through subsequent transactions.[6] The Supreme Court stated that:

• Bavčar received approximately EUR 21.68 million;
• Kristjan Sušinski approximately EUR 3.53 million.[6]

It also noted that Boško Šrot had already been: finally convicted for the predicate offence from which the money originated.[6] What does this case prove? It does not prove: that the entire privatization of Istrabenz was criminal. It proves: specific, finally established criminal conduct in an ownership-financial transaction involving Istrabenz shares. That distinction must be preserved. What is the broader Slovenian pattern?

After the financial crisis, banks often became, because of unpaid loans secured creditors, direct or indirect owners of shares and participants in corporate restructuring. In 2013 the IMF warned that state-owned banks had ended up holding stakes in retail chains, breweries, hotels and newspapers[2]. This created an interesting feedback loop: a bank finances ownership concentration → the takeover becomes overleveraged → the loan turns bad → the bank seizes or acquires shares → the bank itself becomes an owner of the company. That is a systemic mechanism. It is not, in itself, a criminal offence.

Operation “Maestro”: corruption inside the privatization apparatus itself. Josip Matanović was: vice-president of the Croatian Privatization Fund. In 2009 he was convicted of corruption offences connected with investment projects, hotel privatization and company privatization[7]. In 2010 Croatia's Supreme Court upheld: an 11-year prison sentence and confiscation of:

• EUR 250,000;
• HRK 125,500 in illicit gain.[8]

An important European safeguard. Matanović also brought his case before the European Court of Human Rights. In 2017 the ECtHR did not find that police had: impermissibly incited him to commit corruption.[7] It did, however, find:

• a violation of fair-trial rights because of lack of access to part of the evidence;
• a privacy violation relating to certain covert surveillance measures.[7]

That matters. It means: the domestic conviction and the ECtHR's findings of procedural violations are two separate facts that must be presented together. Croatian Supreme Court: final economic fraud in a privatization process.

In 2020 the Croatian Supreme Court published another very direct privatization case.[9] Between 1995 and 2000, the convicted person acquired a controlling package and majority ownership of a company through privatization, purchased shares in instalments, had decided in advance not to pay minority shareholders the agreed price and subsequently transferred the shares to companies within a group under his control[9]. The minority shareholders, who were also employees, were defrauded of: DEM 4,073,498.81 or approximately HRK 16 million at the time.[9] The Supreme Court legally classified the conduct as: economic fraud.[9] This is a direct example of judicially confirmed abuse: inside the process of acquiring privatization ownership. INA–MOL: when an ownership deal becomes a political-criminal case. In 2021 Croatia's Supreme Court upheld the guilty verdict in the INA–MOL case.[10] Those finally convicted were:

• former Croatian prime minister Ivo Sanader, sentenced to six years in prison;
• MOL chairman Zsolt Hernádi, sentenced to two years in prison.[10]

The Croatian court found an agreement involving: EUR 10 million in bribes in exchange for contractual changes that gave MOL management rights in INA.[10]

What does this judgment prove — and what does it not prove?

It proves: a final Croatian criminal finding of bribery connected with INA governance rights. It does not automatically prove that the original 2003 sale of 25% + 1 share was corrupt, that every later INA business decision was unlawful and that MOL's entire ownership position resulted from a criminal offence. The criminal case concerns: specific agreements and governance rights.

Status in September 2026. The Croatian domestic judgment remains final. The European Court of Human Rights, in its current Croatia country profile, states that the cases: Sanader v. Croatia and Hernádi v. Croatia were communicated to the Croatian government in September 2025.[11] That means: proceedings before the ECtHR exist. It does not mean: the ECtHR has overturned the Croatian convictions.

SERBIA — “24 CONTROVERSIAL PRIVATIZATIONS” IS NOT THE SAME AS 24 PROVEN CRIMINAL OFFENCES

In 2012 the European Parliament called on the Serbian authorities to review: 24 controversial privatizations and company sales.[12] Among the cases were Sartid, Jugoremedija, Mobtel, C Market and ATP Vojvodina[12]. The resolution referred to serious concerns expressed by the European Commission regarding the legality of the procedures.[12] This is a political-institutional signal, not a court judgment.

The list of 24 cases became an important symbol of Serbia's transition. But: “24 controversial privatizations” ≠ “24 proven criminal privatizations.” The outcomes differed by case investigations, indictments, partial convictions, acquittals, limitation periods and civil disputes. This article therefore does not use the list as a collective verdict. Petar Drapšin: a final case involving company money used to finance a privatization position.

In February 2026 Serbia's Supreme Court rejected requests for protection of legality by three persons who had already been finally convicted in the case: AD Petar Drapšin Novi Sad.[13] In the published judgment the persons are anonymized as AA, BB and VV. They had been finally convicted of: two criminal offences of abuse of the position of a responsible person committed jointly.[13] The mechanism is exceptionally important.

The Supreme Court summarized the established facts as follows responsible persons and majority owners obtained a bank loan through the company, created a fictitious legal basis through “housing loans”, transferred the money to their personal accounts, then transferred the funds to a bank or consortium and the money was used to settle earlier obligations and participate in the privatization process[13]. For the second offence, the court also found that company funds had been used: in the subsequent privatization process.[13] This is one of the most direct judicial cases in the entire series: money belonging to the target or already acquired company was misused to finance the owners' position in privatization. Serbia's Supreme Court has also legally recognized classic asset stripping.

In another case, the Supreme Court of Cassation found that a majority owner of a privatized company, before completing all privatization obligations transferred assets, transferred the right to carry out the business activity to another company, left liabilities behind in the privatized company and placed the company in the position of a bankruptcy debtor[14]. The court held such agreements: void because they constituted an abuse of rights and violated the principles of good faith and fair dealing.[14] This is a civil-commercial judicial finding, not a criminal conviction. But it very clearly illustrates the mechanism: privatize ownership → move useful assets elsewhere → leave liabilities in an empty shell.

BOSNIA AND HERZEGOVINA — OFFSHORE STRUCTURES, SHARES AND BOSNALIJEK

Bosnalijek is important because it connects company management, offshore companies, sham services, international financial flows and purchases of property and shares. The 2023 indictment. In August 2023 the Prosecutor's Office of Bosnia and Herzegovina filed an indictment against:

• 11 natural persons;
• 4 legal entities.[15]

The prosecution alleged that Bosnalijek had suffered damage of: BAM 10,849,609.43, while the accused had obtained approximately: BAM 9,984,508.01 in unlawful gain.[15] According to the indictment, Bosnalijek funds were paid through foreign companies for alleged marketing services and alleged consulting services. which the prosecution said were not actually performed.[15] The money was then allegedly used for real estate, vehicles and shares[15].

An indictment is not a judgment. This is important. For most persons, the case initially consisted of: prosecution allegations. But part of the case later moved to a higher evidentiary level. Aziz Šukalo: guilty plea. In March 2024 Aziz Šukalo: fully admitted guilt in the Bosnalijek case for organized crime connected with money laundering and concluded a plea agreement with the Prosecutor's Office of BiH.[16] On 4 April 2024 the Court of Bosnia and Herzegovina found him guilty and imposed:

• one year in prison;
• a BAM 73,000 fine;
• confiscation of unlawfully acquired proceeds.[17]

This is a judicially confirmed part of the wider story. The broader Bosnalijek case: first-instance judgment in December 2025. On 18 December 2025 the Court of Bosnia and Herzegovina issued a first-instance guilty judgment in the broader case: Nedim Uzunović et al.[18] Nedim Uzunović was sentenced at first instance to: 10 years in prison.[18] Several other natural persons received shorter sentences, while three legal entities were each fined: BAM 2.5 million.[18] Key safeguard. The court itself clearly labels the decision: first-instance.[18] This article therefore does not state: “they are all finally guilty.” For the broader group: the appellate stage remains legally relevant.

MONTENEGRO — TELEKOM: FOREIGN CORPORATE ADMISSIONS AND A DOMESTIC CASE STILL OPEN IN 2026

The privatization of Telekom Crne Gore is one of the rare cases in which we have a major international anti-corruption investigation, corporate acknowledgement of responsibility in a US agreement and a long domestic procedural history. Magyar Telekom and the US FCPA case. In 2011 the US Department of Justice entered into a: deferred prosecution agreement — DPA with Magyar Telekom.[19] Magyar Telekom stated in its own announcement that under the DPA it: agreed to acknowledge the DOJ allegations and accept responsibility for the conduct described in the criminal information.[20] It paid: USD 59.6 million in criminal penalties.[19]

What did the DOJ state about Montenegro? The DOJ said that, in connection with the acquisition of Montenegro's state telecommunications company, Magyar Telekom made: improper payments.[19] The payments were concealed in the books through: four sham contracts.[19] For two contracts in particular, the DOJ stated that they were backdated, concealed the true contractual parties and involved approximately EUR 4.47 million for which no legitimate services were performed[19]. In its civil case the SEC alleged a wider figure of approximately: USD 9 million paid through four sham contracts in connection with the Montenegrin acquisition.[21]

What does the US case not prove? It does not give this article a licence to determine: which Montenegrin politician personally accepted a bribe unless that is finally established in an appropriate proceeding. The US corporate resolution is evidence of: Magyar Telekom's responsibility within the US FCPA case. It is not a substitute for an individual domestic conviction of every allegedly involved person. Domestic Montenegrin proceedings: a final acquittal in one concrete case and a broader prosecution track still continuing.

In September 2025, the Court of Appeal of Montenegro finally upheld the acquittals of Miodrag Ivanović and Oleg Obradović in a specific case in which they had been accused of abuse of office in connection with the Rawleigh Trading contract. The court held that the allegation in the indictment had not been proven.[26] That final acquittal must be distinguished from the state's later initiative concerning the broader Telekom privatization affair. On 2 October 2025, the Montenegrin Government decided that the state, as an injured party, would pursue prosecution as a subsidiary prosecutor.[22] In May 2026, according to the Montenegrin Government, the Higher Court held that the prosecution was not time-barred.[23] As of September 2026, it is therefore inaccurate to say either that there has been no final domestic outcome at all in the Montenegrin Telekom cases, or that the wider privatization affair has been finally resolved by a conviction. One concrete criminal case ended in acquittal, while the state is still attempting to pursue the broader matter through a different procedural route.

NORTH MACEDONIA — MAGYAR TELEKOM: BRIBERY FOR REGULATORY BENEFITS AFTER PRIVATIZATION

The same US case also includes Macedonia. But here the chronology is extremely important. MakTel was privatized in: 2001. The corrupt conduct documented in the US proceeding primarily concerns: 2005 and 2006.[19] That means: it is not proof that the original 2001 sale of 51% of MakTel was itself purchased through bribery. What did Magyar Telekom acknowledge under the DPA? The DOJ said that, because of planned opening of the Macedonian telecommunications market, the company sought political support for:

• delaying entry of a new mobile competitor;
• securing other regulatory benefits.[19]

According to the court documents, executives used: sham consulting contracts with a combined value of approximately: EUR 4.875 million while knowing, or being aware of a high probability, that part of the money would be transferred to Macedonian officials.[19] Under the DPA, Magyar Telekom: acknowledged the DOJ allegations and accepted responsibility for the charged conduct.[20] Important distinction. This is: post-privatization regulatory corruption. It is not the same as: corruption in the original privatization purchase price. This article includes it because it shows how, after privatization, a strategic owner may seek to protect market position, regulatory advantages and profitability of the acquired company.

KOSOVO — TRADING IN INFLUENCE IN A PRIVATIZATION TENDER

In February 2015 the Basic Court in Pristina convicted two persons identified in the EULEX release by the initials: H.T. and B.D.[24] They were convicted of: trading in influence committed jointly. What was the subject of the case? The case concerned a privatization tender involving approximately: 91 hectares of agricultural land near the village of Muzakaj.[24] According to the judgment, they received or accepted: EUR 200,000 in undue benefit in exchange for a promise to improperly influence officials of the Kosovo Privatization Agency before the 2009 tender.[24] Each was sentenced to: 15 months in prison, and the court ordered confiscation of: EUR 200,000.[24]

But the legal status must be labelled precisely. The EULEX release explicitly states: all parties have the right to appeal.[24] Within the source set reviewed for this article, we did not find a sufficiently reliable public document proving the final appellate status of this specific case. We therefore classify it as: a first-instance guilty judgment, not a verified final judgment.

Kosovo also shows the opposite problem: many high-profile cases did not end in conviction. In its justice monitoring report, EULEX noted that numerous high-profile corruption cases ended in lenient sentences, acquittals and/or retrials[25]. That is an important safeguard. A large number of: allegations is not the same as a large number of: final proofs of corruption.

WHAT REPEATS ACROSS THE REGION?

If we remove the country and personal names, several recurring mechanisms remain. MECHANISM A — debt-financed management buyout. A manager wants to become an owner. They do not have enough of their own capital. So they:

1. establish an acquisition vehicle;
2. obtain a bank loan;
3. pledge shares or other assets;
4. expect the future cash flow of the target company indirectly to service the acquisition.

This can be: a completely lawful leveraged buyout. The problem arises when the bank ignores credit risk, prohibited related-party relationships exist, company assets are used against the company's interests and sham transactions are used. MECHANISM B — the company finances its own acquisition. Petar Drapšin demonstrates an extreme version. The company takes out a loan. The money is transferred to responsible persons through a fictitious legal basis. It is then used for: the owners' privatization obligations.[13] At that point the distinction between company owner, debtor and target company. nearly disappears.

MECHANISM C — asset stripping. After acquisition the best real estate, equipment, contracts and business activity. are transferred to another company. The old company is left with debts, employees and tax liabilities. In one privatization case, Serbia's Supreme Court legally classified such a mechanism as: an abuse of ownership rights, making the agreements void.[14] MECHANISM D — the privatization official as gatekeeper.

If a single official influences valuation, tender design, buyer selection, land and consent, that official can become: the gatekeeper of the transaction. Croatia's Matanović is a judicially confirmed example of corruption: inside the privatization institutional apparatus itself.[7][8] The Kosovo H.T./B.D. case, at first instance, similarly concerns trading in influence around: decision-making by the privatization agency.[24] MECHANISM E — the strategic buyer and the regulator.

After privatization the buyer often needs a licence, a tariff, a concession, a legal amendment and protection from competition. Corruption risk may then no longer arise at: the purchase of the company, but in: regulation of the company after acquisition. The Macedonian portion of the Magyar Telekom case is a clear example.[19][20] MECHANISM F — sham consulting agreements. This is almost a classic corruption channel. Money is formally paid for consulting, marketing, lobbying and analysis. If the service is not actually performed, the agreement may function as: a channel for transferring money. The pattern appears in:

• the US Magyar Telekom case;[19]
• the Bosnalijek indictment and first-instance judgment.[15][18]

MECHANISM G — offshore companies. An offshore company is not illegal. It can have legitimate tax, investment and international business functions. But an offshore structure can reduce transparency regarding beneficial ownership, money flows and purpose of a transaction. Bosnalijek is a judicial case in which the use of offshore companies was: part of the alleged and, at first instance, established money-laundering mechanism.[15][18] WHERE DOES POLITICS ENTER?

This is the most sensitive question. Political influence can appear at several levels appointments to supervisory boards of state-owned banks, appointments to funds and agencies, decisions over what is privatized, selection of privatization method, post-privatization regulation, concessions and state guarantees. But political connection alone is not a criminal offence. We therefore need to distinguish: structural political power from proven corruption by an individual. Slovenia: risk of political influence over state-owned banks.

After the crisis, the IMF highlighted in the Slovenian banking system connected lending, weak risk controls and potential political influence arising from state ownership of banks[2]. This is an assessment of institutional design. It is not a judicial finding: that a particular political party ordered a particular loan. Without concrete evidence, this article does not take that step. Croatia: here we have a final individual political case.

In the INA–MOL matter, a former prime minister was: finally convicted of accepting a bribe connected with governance rights.[10] That is a much stronger evidentiary level than: a general suspicion of political connections. Montenegro: international corporate evidence, domestic individual proceedings not yet complete. Magyar Telekom acknowledged responsibility for the conduct described in the US criminal information.[20] But as of September 2026 the Montenegrin domestic case is: still active.[22][23] We therefore do not label specific domestic political persons: finally guilty where no such final domestic judgment has been established. Final or admitted. Slovenia.

• Bine Kordež — guilty plea and conviction.[4][5]
• Igor Bavčar, Kristjan and Nastja Sušinski — final Istrabenz/money-laundering case; the connected predicate offence involving Šrot had also been finally established.[6]

Croatia.

• Josip Matanović — final corruption conviction connected with the privatization fund.[7][8]
• economic fraud in acquisition of a controlling stake during privatization — confirmed by the Supreme Court.[9]
• Ivo Sanader and Zsolt Hernádi — final Croatian convictions in the INA–MOL case.[10]

Serbia.

• responsible persons in AD Petar Drapšin — finally convicted; the Supreme Court rejected extraordinary legal remedies in 2026.[13]
• civil-commercial: in a separate case the Supreme Court of Cassation treated privatization asset stripping as abuse of rights and declared the contracts void.[14]

Bosnia and Herzegovina.

• Aziz Šukalo — guilty plea and judgment in the Bosnalijek case.[16][17]

International corporate level.

• Magyar Telekom — DPA with the DOJ and acknowledgement of the allegations/responsibility for conduct connected with Macedonia and Montenegro.[19][20]

Not yet sufficient for the label “finally proven”. BiH. The wider December 2025 judgment in Nedim Uzunović et al. is: first-instance.[18] Kosovo. The 2015 judgment against H.T. and B.D. was: first-instance with a right of appeal; we did not reliably confirm the final appellate status in the reviewed sources.[24] Montenegro.

One concrete Telekom criminal case against Ivanović and Obradović ended in a final acquittal in 2025.[26] A separate or broader state initiative to pursue the privatization affair as a subsidiary prosecutor was still procedurally ongoing in 2026.[22][23] “All privatizations were carried out by politically connected tycoons.”. No. The evidence shows many different purchasers employees, funds, foreign corporations, domestic businesspeople and institutional investors. “Every management buyout was criminal.”.

No. Management and leveraged buyouts are: standard financial techniques. Criminality arises from: the specific financing method or abuse. “If a bank financed a takeover, it was corruption.”. No. A bank can lawfully finance an acquisition. The problems are unlawful related lending, conflicts of interest, false information, inadequate collateral and misuse of the company to repay a private acquisition. “An indictment proves guilt.”. No. The Bosnalijek case shows exactly why we must distinguish:

• the 2023 indictment;
• Šukalo's 2024 guilty plea;
• the broader group's first-instance 2025 judgment.

These are: three different evidentiary levels. “If a foreign company paid an FCPA penalty, every named domestic politician is proven guilty.”. No. A corporate admission: establishes the company's responsibility in the specific legal proceeding. Individual criminal liability requires: separate evidence.

WHAT IS THE MOST IMPORTANT LESSON OF THIS ARTICLE?

Privatization abuse often does not look like: someone carrying a factory out through the gate. It can be a chain of entirely ordinary legal instruments:

• a loan;
• a pledge;
• a consulting agreement;
• a share transfer;
• recapitalization;
• a real-estate sale;
• an offshore account;
• a regulatory decision.

Each individual step can appear on paper to be: ordinary. A criminal offence arises when those instruments are used for abuse of office, deception, unlawful benefit, concealment of the origin of money, bribery and improper influence. A research article should therefore not search for: “suspicious people.” It should search for: provable chains of transactions.

A recurring mechanism: control of a company with limited own capital

In several cases the key issue in ownership concentration is: whose money actually made the new owner an owner? Possibilities include the buyer's own capital, a bank loan, money from other investors, company funds and the company's future cash flow. If the buyer mainly risks: their own capital, the risk is private. If ownership is built with high leverage, a state-owned bank, company funds and a state guarantee. part of privatization risk can: shift back onto society. This is the central bridge between Sold Too Cheaply? Anatomy of the Most Controversial Privatizations of Former Yugoslavia: Price, Value, Debt, Land and Final Owners and this article.

This was not merely a marginal feature of a few transactions. In 2012 the IMF reported that financial holding companies used for privatization through highly leveraged buyouts, together with construction, accounted for about 21% of all bank loans at end-2011.[27] This does not mean that every management buyout was unlawful. It does mean that the model became large enough for its failure to hit the banking system and become a social problem rather than a purely private one.

When the official diagnosis is harsher than “a bad business decision”. In its 2015 report on the causes of the banks’ capital shortfall, the Bank of Slovenia used considerably more direct language: leveraged-buyout acquirers using small amounts of their own capital caused large losses in the banking system, while financial holding companies used excessive borrowing to seek ownership influence over as much of the economy as possible; the report also pointed to inadequate development vision and ineffective corporate governance.[28]

The same report states that as early as July 2008 the Bank of Slovenia provided parliament with information on banks’ role in the takeovers of Pivovarna Laško, Merkur and Istrabenz.[28] This does not mean that every loan involved in those takeovers was criminal or that every participant committed an offence. It does mean that the later problems cannot be described fairly only as the result of the global financial crisis or a few unfortunate business decisions. Highly leveraged ownership restructuring was officially identified as a domestic source of systemic banking risk.

WHO ULTIMATELY BORE THE RISK? If an acquisition succeeds: the owner receives the capital gain. If an overleveraged acquisition fails losses can fall on: the bank, the state as bank owner, creditors, employees, suppliers and taxpayers. The next question is therefore unavoidable. It is no longer: who got the company? It is: who paid the bill when takeovers, banks or privatized companies failed?

Across these cases, the article consistently distinguishes a business connection, an official institutional finding, an indictment, a first-instance judgment, a final judgment, and a guilty plea. Political connections, large loans, or management buyouts are not themselves equated with corruption, while cross-border cases state the status of each person and legal forum separately. A specifically adjudicated case therefore does not become an automatic verdict on an entire country’s privatization process.

The question of who ultimately bore the losses from such processes continues in Who Paid the Transition Bill? Bank Rescues, State Assumption of Debt, Guarantees, Subsidies, Bankruptcies and the Socialization of Private Losses from Slovenia to Kosovo.