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Ljubljana - A decade ago, with Slovenia cruising towards membership of the European Union, a local brewery called Union caught the eye of Belgian beer giant Interbrew.
Union and its larger rival, Lasko, are national treasures in Slovenia, a question of allegiance that divides beer drinkers the same way soccer splits Manchester between City and United.
Determined to keep Union in Slovenian hands, the country used every trick it knew to thwart Interbrew's advances.
Finally it gifted Union to Lasko, brushing aside complaints from Interbrew and creating a monopoly that to this day controls 80% of the Slovenian beer market.
Then came the hangover.
Ten years and millions of euros in accumulated debt later, Lasko is one of dozens of companies controlled directly or indirectly by the Slovenian state that face being sold in a fire sale of national assets to steady the country's finances.
If all goes well, Slovenia will avoid becoming the latest euro zone country to need a bailout. Its battle is a reminder that the euro zone debt crisis is still casting shadows.
"We reckoned we all stood to profit," Dusan Siljan, a former head of sales at Lasko who retired this week, said of the merger with Union.
"There would be no competition and, together, we had a better chance of staving off a possible new takeover attempt by Interbrew," said Siljan, who represents 1,000 small shareholders controlling around 5 percent of the brewery.
Now, he says, Lasko risks being sold "far below the real price", as Slovenia races to raise money, cut its deficit and reform the public sector.
The former Yugoslav republic of 2 million people, tucked below the Alps, revealed a €4.8bn hole in its mainly state-run banking system two weeks ago, the result of loans turned sour when exports hit a wall with the onset of the global economic downturn.
The government said it could plug the gap alone, without becoming the latest member of Europe's troubled euro currency union to need an international bailout.
But if the fix is to last, Slovenia must remake an economy 50% controlled by the state, and abandon a policy that kept local firms in local hands while the rest of Europe's ex-communist east threw open the gates to Western capital after the Cold War.
"Lasko followed the policy of 'protecting national interests', tacitly supported by the government," said Borut Hocevar, an editor at the Slovenian business daily Finance.
But as the company's troubles grew, its share price steadily fell from almost €100 ($140) in 2007 to a little over three euros now. "Not selling my shares was the biggest mistake of my life," said Siljan.
Slovenia now plans to abandon stakes in 15 companies, including the biggest banks, the local telecoms provider and national carrier Adria Airways. Unemployment, already over 12%, is likely to rise.
Lasko, though not on the list, is nevertheless at the mercy of its chief owners - state banks now looking to divest.
In a complex ownership scheme typical of many Slovenian companies, eight banks jointly control more than 50% of Lasko and may have to sell their stakes as part of their own restructuring.
Lasko's current market valuation of around 31 million euros, however, is dwarfed by debts almost 10 times that amount. A supervisory board meeting last week acknowledged Lasko was struggling with short-term liquidity. The brewery declined to comment for this article.
Saso Stanovnik, chief analyst at leading Slovenian brokerage Alta, told Reuters:
"The most likely outcome is to find foreign buyers, possibly some European breweries, for parts of the Lasko group. With this, the story about 'national interest' in Lasko would have a very ironic ending, but probably a useful one for its further development."
But even at a knockdown price, Lasko, one of the biggest breweries in the Balkans, may struggle to find a suitor.
Under a previous management, Lasko went on a spending spree that saw it acquire a mineral water bottler, a spa and juice producer Fructal, which it has since spun off.
It also has stakes in a daily newspaper and almost 21 percent of leading retailer Mercator, itself a takeover target of Croatian rival Agrokor.
"With the previous management, we were buying left, right and centre and neglected our core business. If we had focussed on that, today we could rightly say, 'recession? What's that?'," said Siljan.
Reports in local media have homed in on Turkish brewery Efes. But Tuncay Ozilhan, chairman of Anadolu Group that owns Efes, told Reuters: "I am familiar with the company, I know Lasko, but no, it's not true. We are not interested in buying it."
Heineken, also mooted as a possible buyer, declined to comment.
Lasko's biggest shareholder, top state-owned bank NLB with 23%, declined to reveal its plans.
But local media said it would transfer its stake to a 'bad bank' created by the government this year to ring-fence billions of euros in bad loans and unburden the banks for easier sale. The bad bank could hold on to Lasko or, more likely, sell it on.
Another bank, Nova KBM, told Reuters it would definitely sell its holding in Lasko when it decides the time is right.
Hypo Bank, which has seven percent, said its main aim was "to provide quality financial services rather than own stakes in companies" - a sign it too may be pulling out.
In the first nine months of this year, Lasko posted an operating profit of €26m, down 11% on the previous year. The net loss of €10.8m was halved from last year's nearly €22m loss.
Workers at Union, located in a sprawling green and grey complex just off downtown Ljubljana, were reluctant to discuss their fate. "You should ask the management about that," said one.
But Andrej Skorja, a trade union leader, said there was little doubt where the future lay.
"Foreign owners? That is effectively our future. I see no other way, and we're ready for it. The only issue is whether it will create problems for ... the employees."
