Bulgaria launches Bulgartabac privatisation

Bulgaria launches Bulgartabac privatisation

Bulgaria's privatisation agency launched on Tuesday the sell-off procedure for the state's 79.83% holding in tobacco giant Bulgartabac, expecting to find a buyer for the group within four months.

The company will be sold through a one-off competitive procedure, which could be joined by strategic and financial investors.

Potential strategic investors will be required to have generated an annual revenue from sales of tobacco products of EUR 1 billion in the last three financial years and to have the capacity to process 12,000 tonnes of tobacco and produce 35 billion cigarettes a year.

"None of the Bulgarian companies meet the criteria, Philip Morris, Japan Tobacco International and South Korea's KT&G, which has shown interest, comply with them, so does British American Tobacco, which however is not interested in the privatisation, Emil Karanikolov, head of the privatisation agency, said.

In turn, eligible financial investors should manage and/or own holdings in other entities worth a minimum EUR 1 billion in each of the last three financial years and to boast an equity of a minimum EUR 30 million. According to privatisation agency data, so far three financial investors have expressed willingness to take part in the tender for Bulgartabac.

Candidates will be allowed to purchase tender documents within a 30-day period beginning on May 10.

The privatisation agency has not set a minimum price for the tobacco group, as recommended by Citigroup, which was selected in September 2010 to serve as adviser on the deal.

Earlier, sources told Dnevnik that КТ&G, Japan Tobacco International (JTI), one Czech and one British investment fund have shown interest in Bulgartabac. /Source: Dnevnik/

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