Financial and insurance group Eurohold Bulgaria said on Tuesday that it has completed the acquisition of the local business of Czech energy group CEZ for 335 million euro ($396.5 million).
The group, through its wholly-owned subsidiary Eastern European Electric company, acquired a 67% interest in electricity distributor CEZ Distribution Bulgaria and power supplier CEZ Electro Bulgaria, as well as 100% of the shares of licensed electricity trader CEZ Trade Bulgaria, IT services company CEZ ICT Bulgaria, solar park Free Energy Project Oreshetz, biomass-fired power plant Bara Group, and CEZ Bulgaria, the coordinator of CEZ Group’s units in Bulgaria, the buyer said in an e-mailed statement.
"This acquisition of CEZ Group’s subsidiaries is a milestone in the development of not only our company, but the Bulgarian economy as well. It has ensured an inflow of over 500 million euro in the Bulgarian economy if we estimate the total value of the deal, including the price of the transaction, the forthcoming mandatory tender offer to the minority shareholders in two of the acquired companies and the investment programme of CEZ in Bulgaria," Assen Christov, chairman of the supervisory board of Eurohold Bulgaria, said in the statement.
Following the successful integration of CEZ’s subsidiaries in Bulgaria, Eurohold will aim to support the current and future investment programme of CEZ in Bulgaria focusing on customer service, network upgrade and maintenance, innovations, technologies and digitalisation, as well as renewable energy and energy efficiency, Christov added.
Еurohold will retain most of the existing CEZ Bulgaria’s management team in order to secure the expertise and experience that has been gained through the years, while at the same time inviting new members to join the board, according to the statement.
"Upon acquisition and integration of CEZ Group’s assets, Еurohold will more than double the number of customers it serves to over 7 million, and employ more than 6,000 people in 11 countries in Central, East and Southeast Europe and the former Soviet Union," the group said.
The total assets and revenue of the combined company are expected to exceed 1.5 billion euro, while its EBITDA is forecast to reach around 120 million euro per year. According to the development strategy, Еurohold expects to generate revenue and EBITDA of almost 2 billion euro and 200 million euro per year by 2025, respectively, the company said.
Earlier this month, Eurohold Bulgaria raised over 157 million levs ($94.7 million/80.3 million euro) through a public offering of new shares, securing the funding it needed to buy CEZ Group's subsidiaries in Bulgaria. Еurohold raised about 24% more than the 65 million euro required for the acquisition, the group said at the time.