VTB Capital enters the Bulgarian market with interests in energy and transport The Russian investment company VTB Capital has entered the Bulgarian market, with interest in sectors like energy, transport, agriculture and food industry, stated Atanas Bostandjiev, CEO of VTB Capital in London, during the presentation of the activities of the Sofia-based company. In fact, the company, which owns the Bulgartabac Holding JSC will step on the Bulgarian market through the acquisition of Delta Capital held by Milen Velchev and Georgi Velchev as well as by Krassimir Katev. The former Finance Minister, Milen Velchev, would be the company's CEO. "We want to aid the development of the Bulgarian financial and capital market and contribute to the development of the Bulgarian and regional economy. We have not planned the exact amount of acquisitions to be realised, but we will develop our business step by step, while providing our services and registering the actual dynamics index here, " explained Bostandjiev. Besides, VTB Capital confirmed its interest in purchasing BTC and BDZ- Freight services' LTD, but refused to specify details. Besides, the sale of minority shares of EDCs (Electricity Distribution Companies) via the Bulgarian Stock Market is also a good auction option, indicated the company's management. Regarding the sale of Bulgartabac, Bostandjiev reckoned that the main objective was for the company to stabilise and strengthen its business first so as to be sold to a future strategic investor. In addition to its business plans, VTB Capital officially disclosed that it was the new sponsor of the Professional Football Club Levski. The news was announced by the company's CEO, Atanas Bostandjiev. He stated that the Russian industrial giant had already signed a contract with the Blue Football Club. Representatives of VTB Capital stated explicitly that they had definite interest in aiding the sports sector in our country, but none of them was willing to submit more details on the financial specifications of the very contract concluded with PFC Levski because of the confidentiality in the transaction.
Source: Class (02.03.2012)

The tobacco holding Bulgartabac will once again be offered for sale as its new Russian owner intends to resell it to a strategic investor after stabilising the company in order to achieve a lucrative deal. This was announced by the CEO of VTB Capital Atanas Bostandzhiev at a press conference yesterday (1 March) on occasion of the opening of the company’s first office in Sofia. Last summer the Russian VTB Bank acquired about 80% of Bulgartabac for EUR 100 million. The deal was concluded with a subsidiary of VTB – BT Invest, registered in Austria. The Sofia branch of VTB Capital will be headed by former Finance Minister Milen Velchev, his brother Georgi Velchev and former Deputy Finance Minister Krasimir Katev. Their company – Delta Capital, will be acquired by VTB Capital. VTB Capital is interested in the sale of the Bulgarian Telecommunications Company and the Bulgarian State Railways Freight Services, but has so far not announced further details. The assets of VTB Capital amount to over USD 200 billion, the Chairman of the Management Board of VTB Bank Yuri Soloviev announced. The investment intentions of VTB Bank in Bulgaria have in most cases been related with the name of the majority shareholder of Corporate Commercial Bank (CCB) Tsvetan Vasilev, the Capital Daily reads.
Source: Standart (02.03.2012)

Bulgaria's largest cigarette maker Bulgartabac plans to export a total of 15.5 billion cigarettes to the Middle Eastern market this year and achieve a further 7% export growth to the region in 2013. The company has pointed out in a statement that it has achieved a double digit growth in its exports to the Middle East since 2008 – by 45% in 2008 and 2009, by 115% in 2010 and by a further 25% in 2011. Bulgartabac recently took part in the World Tobacco Middle East event in Dubai together with some 100 other producers. The event attracted visitors from over 30 countries including the United Arab Emirates, Iran, Egypt, Bahrain, Jordan, Saudi Arabia, Greece, Turkey, Qatar, India, Pakistan and Yemen
Source: Dnevnik (03.04.2012)

Tobacco holding Bulgartabac intends to restore its position in the Russian market, which it dominated in the 80s of last century. The news came from the statement of Athanas Bostandzhiev, head of VTB Capital, which bought Bulgartabac for EUR 100.1 mln. According to Bostandzhiev, the new owner of Bulgartabac intends to restore its standing as a leading regional player in the market of cigarettes. For that purpose Bulgartabac has filed an application for registration of trademarks Stuardesa, Rodopi, BT and Opal. This is because in late 2011 and early 2012 the Patent Office of Russia cut off the legal protection of trademarks Stuardesa, BT and Rodopi after a request submitted by the Russian company SaShiKo. Currently, the Bulgarian tobacco holding exports about 500 million cigarettes to the Russian market with the brands MM, Prestige and C Class. These quantities, however, are just a scratch compared to the 70 billion cigarettes Bulgaria exported to Russia in the 80s of the twentieth century.
Source: Standart (06.04.2012)

Cigarette producer Blagoevgrad BT may pay its majority owner Bulgartabak holding up to BGN 12.4 million fees (royalties) to the end of the year and another BGN 5.8 million for commercial representation in the EU. This is the maximum sum of the deals, concluded on contracts and annexes, signed in the last 17 years. Management of the cigarette factory has received shareholders’approval to pay obligations for the period from early May until the end of the year only. From the total amount of payments up to BGN 8.9 million will be a royalty on sales of tobacco products in Bulgaria. For exports – in the EU and beyond, BGN 3.5 million will be paid. Another BGN 5.76 million is planned to go as remuneration for commercial representation
Source: Capital (26.06.2012)

Bulgaria's Central Cooperative Bank (Corpbank) plans to borrow 9.0 million euro ($11.2 million) as a subordinated debt from its major shareholder, local financial intermediary Bromak. The deal, which is aimed at increasing the capital base of the commercial lender, is pending permission from the Bulgarian National Bank, Corpbank said in a statement to the Sofia bourse. The six-year loan will bear an annual interest rate of 7.0%, the statement added. At the end of March, Bromak held a total of 3,017,310 shares in Corpbank, equivalent of a 50.29% stake.
Source: Capital (27.06.2012)

Bulgarian trading company Dar Finance has acquired on the local bourse the 16.7% stake in financial and insurance group Eurohold Bulgaria held by Sofia-based financial services company Expat Capital. Dar Finance, wholly-owned by Liechtenstein-based Daru Aktiengesellschaft, will be consulted by London-based VTB Capital through its unit in Sofia.
Source: Capital (02.07.2012)

Twenty-four hours before the deadline for the submission of documents for participation in the bid for the sale of freight railway operator BDZ-Tovarni Prevozi, three potential buyers became clear. That was announced by Mr. Emil Karanikolov, Executive Director of the Privatisation and Post-Privatisation Control Agency. The three candidates include: Czech logistics company Advanced World Transport, Romanian Grup Feroviar Roman (GFR), and lawyer Petko Ilchev. The Romanian company is a majority owner of Bulgarian-registered Bulgarian Railway Company. As for lawyer Petko Ilchev, his employer is a mystery. According to unofficial information, he represents the interests of Russian Vneshtorgbank and Bulgarian Corporate Commercial Bank.
Source: Capital (05.07.2012)

Bulgarian cigarette filters maker Yuri Gagarin has ceased the production of filter cartridges in compliance with a newly adopted bill which prohibits their production and sale. Filter cartridges production, in which the company has invested over EUR 5.0 million, was an essential part of its activity. Yuri Gagarin, based in Bulgaria's second-largest city of Plovdiv, produces cigarette packaging, filters and printing products. The company is to sell made filters abroad. Preparations with cartridges take up 20% of its capacity and 80 % of production for export.
Source: Capital (06.07.2012)

The union between the Corporate Commercial Bank and Russian VTB Capital is BTC ‘s most preferred buyer. There are no details of the offer, yet. The main coordinating body of BTC’s senior secured creditors and its parent company agreed in principle on terms of the sale of BTC to the two financial investors. In accordance to data released by BTC, financial investors offer two choices-as prices per share vary between BGN0.81 and BGN 1.92. If all the options are exercised, senior secured lenders will be able to fully repay their participation against a total of BGN 617 million. Effective share price of acquisition will depend on the exercise of various options by creditors. If all requirements are followed the deal is expected to terminate in September 2012.
Source: Capital (20.07.2012)

Vivacom to restructure a ˆ1.7 bn debt The Bulgarian telecom operator Vivacom has notified its creditors that a meeting will be held in the English High Court on August 30 to hammer out an agreement for the forthcoming acquisition of the company, Reuters reported. The buyers of Vivacom are VTB Capital, a unit of Russia’s second biggest lender VTB Bank, and Bulgaria’s Corporate Commercial Bank (CCBank). The investment fund was already used for the acquisition of Bulgartabac. In order to change the ownership, however, the company must reach an agreement with its creditors. At the meeting on August 30, a restructuring of liabilities of ˆ1.7 bn will be discussed and a hearing of the English court is expected on September 6 to consider approval of the restructuring plan. CCBank and VTB Capital have offered to pay ˆ130 mln in cash for the majority equity stake in Vivacom and repay the company’s debts of over ˆ588 mln. The telecom’s creditors will acquire a minority stake in Vivacom.
Source: Class (14.08.2012)

Plovdiv is Bulgartabac’s next stop With one successful deal Bulgartabac is on its way to fulfil its target of 140 kiosks for the sale of tobacco products and newspapers until the year-end, the Capital daily informs. In end-July the cigarettes distributor from the group – Bulgartabac Trading, bought Eliza 1999 at the cost of BGN 1.022 million. The company is a concessionaire of 314 public transport stops in Plovdiv and currently collects rent from the kiosks at 80 key stops. If the 53 existing sales points of Bulgartabac are added the 140 kiosks target seems close to fulfilment. The tobacco holding is officially owned by Russian VTB Capital as of September 2011. Its unofficial buyers are Tsvetan Vasilev (owner of Corporate Commercial Bank), the MP from the Movement for Rights and Freedoms (MRF) Delyan Peevski and the owners of Vinprom Peshtera.
Source: Capital (30.08.2012)

Vivacom received permission by a British court to continue the restructuring of its debt of EUR 1.7 billion. That decision put an end to the 2-year dispute between Vivacom and its creditors and the attempts at selling the company. As part of the restructuring, Russia’s second biggest bank VTB Capital and Bulgarian Corporative Commercial Bank (CCB) will buy over 70% of the company and will reduce its debt to about EUR 588 million. Because of the EUR 1.7 billion in outstanding debts, BTC had to change ownership. Creditors launched a bid where along with VTB and CCB, investor was also Turkish telecom Turkcell.
Source: Dnevnik (10.09.2012)

There are no more formalities on the way of the acquisition of the Bulgarian Telecommunications Company (BTC) by Corporate Commercial Bank (CCB) and Russian VTB. They will receive at least 73% of the capital of the highly-indebted telecom. The opportunity exists for the stake to be increased in the future. On Monday, at a general meeting, BTC’s shareholders gave the green light to the entry of the new owners in the former state giant. There is only one obstacle on the way to the final acquisition of the shares by CCB and VTB that should not be difficult to overcome – receiving the permission of the European Commission. The papers were submitted in Brussels a month ago and a positive response is expected. Neither CCB nor VTB have a telecommunications business and Brussels will hardly find a reason not to allow the deal.
Source: Standart (10.10.2012)

The deal for the Bulgarian Telecommunication Company (with trademark VIVACOM) is already a fact. The Official Journal of the EU published information for the authorization of the concentration between the BTC, Russian VTB Bank and Corporate Commercial Bank (CCB). The decision for the published notice was taken by the European Commission on 22 October. The full text of the decision has not yet been published, this will happen after all professional secrets have been terminated. The value of the purchase is estimated at EUR 130 million. Buyers will cover and the debts of the company, which amount to EUR 588 million.
Source: 24 chasa (01.11.2012)