Financial news

All DISC bonds were withdrawn from the market after the Bulgarian Ministry of Finance exercised its call option and paid the whole USD 679.3 million principal amount. The actual payment however is much lower, since the USD 293 million collateral, which was held in US treasury bonds, was freed upon the transaction. The payment to be really serviced by Bulgaria stands at some USD 400 million, which will be taken from the fiscal reserve, the ministry explained.  The deal will save some BGN 30 million interest payments a year, or BGN 1 billion for the next 20 years until 2024, when the bonds had to mature. 

Local bank credits have further growth potential, and are not likely to reduce. This is one of the conclusions made in the quarterly reported, prepared by the Center for economic development “Bulgaria’s 2004 Economy”. According to its authors, our country holds one of the last positions in Central and Eastern Europe by share of the credits in GDP (26 per cent). In this top list, only Romania is behind Bulgaria with a share of 18 per cent.

Bulgaria's Foreign Minister Mr. Solomon Passy invited Indian companies to bid for the Belene nuke, the local second nuclear power plant, while holding talks with his Indian counterpart Mr. Natwar Singh. Passy is paying a 4-day official visit to India. He is the first ever Bulgaria's FM to visit the country over the last 24 years. He came up with a proposal India to build up a solar power plant nearby Ahtopol town. Bulgaria will allot land at the seaside and India will bring in experts and technologies.

Privatization

Bulgaria’s Privatization Agency (PA) has generated a turnover of over BGN 4 mln within the fifth remote public auction, which ended yesterday. The agreed payments are in the amount of BGN 4 290 190, BGN 2 653 230 of which in non-cash payment means.

Companies

The first large private cascade of three hydro power plants (HPP) in Bulgaria can now be linked to the national power grid, after the project received the last document needed. Investor in the project is Avers Ltd. of Blagoevgrad. The cascade is built on the river of Retidje in southwestern Bulgaria. The green-field project, which amounts to BGN 7.5 million, was built with the financial support of Economic and Investment Bank. 

A second company for real estate investment is been registered. BenchMark Real Estate Fund is to be a company with special investment purpose. Bulgarian Stock Exchange announced that the new company’s institutional investor is Razvitie Industry Holding. So far, the only company with special investment purpose operating in Bulgaria was TBI - BAC - Real Estate.

The final contract for the acquisition of Bulgaria’s Royal Foods Holding by Greece’s food maker Chipita East Europea Limited has been signed. According to its provisions, the Greek company is to purchase the whole activity of the holding in Bulgaria – trade marks, production capacities, and construction facilities. Chipita East Europe Limited is a subsidiary of Chipita International and controls the Greek holding’s operations in Russia and the countries from Central and Eastern Europe.

The net profit of Bulgaria's Neochim at the end of the second quarter of the year has surged 27.7 per cent to BGN 4.6 million, compared to BGN 3.6 million a year earlier, company report shows. Net sales revenues have also surged 21.6 per cent to BGN 94.5 million. The benefit from exchange rate differences has reached BGN 1 million, compared to BGN 185,000 at the end of June 2003. At the same time the negative differences from forex operations have declined more than five-fold to BGN 185,000.  

M&M Air Cargo Services BG, a subsidiary of international forwarders Militzer&Munch, has opened a cargo terminal at the Sofia International Airport that will be used exclusively for air transportation, the company's managing director Mr. Mihail Danchev said on Wednesday. The BGN 1.2 mlnfacility will absorb another BGN 200,000 by the end of the year, an investment the company is confident will be recouped in some three to four years. 

Mr. Bricolage is planning to open 6 new stores in Bulgaria by the end of 2006, the company announced. This is the biggest investment made by the French company outside France so far. The new joint Bulgarian-French company has signed a EUR 11 mln credit contract with the Bulgarian structure of Societe-Generale – SG Expressbank. The money will be used to finance the building of the new stores.

Bulgaria's Post Bank has received a EUR 30 million syndicated loan. The term of the credit is three years, the margin is set at 1.75 per cent a year. The loan was officially signed at the Athens HQ of the bank's majority owner, EFG Eurobank. The financing is organised by EFG Talesis Finance, a EFG Eurobank subsidiary, which is also agent of the credit.  The loan will be used for strengthening Post Bank's position on the consumer and corporate credit market, CEO Mr. Panayotis Varelas said. 

Europe

Puma, the fast-growing and often off-beat German sports fashion group, has lifted its 2004 sales growth forecast to 20 per cent after outpacing its rivals with a strong set of first-half figures. Sportswear manufacturers were helped by last month's European football championship, in which Puma sponsored the Czech semi-finalists, Italy, Switzerland and Bulgaria. Puma's 20 per cent growth figure implies 2004 sales of more than EUR 1.5bn. The company reiterated its forecast of a rise of more than 30 per cent in this year's pre-tax profits from 2003's EUR 264m.

USA

Avon Products Inc., the world's largest direct seller of cosmetics, said second-quarter profit jumped 35 percent, beating analysts' estimates, on higher sales in Europe, Latin America and Asia and lower tax expenses. Net income rose to USD 232.3 million, or 49 cents a share, from USD 171.5 million, or 36 cents, a year earlier, New York-based Avon said in a statement. Sales rose 13 percent to USD 1.84 billion. 

Asia

ExxonMobil is considering selling its 19 per cent stake in China Petroleum & Chemical (Sinopec), the state-controlled oil group, in a move that could raise some USD 1.2bn for the US oil major - nearly double what it paid four years ago. Such a move would complete the withdrawal of the international groups that bought into Sinopec's overseas initial public offering in 2000 in a show of support for China's fast-growing oil industry. Earlier this year, BP and Royal Dutch Shell sold their stakes in Sinopec, Asia's largest oil refiner, raising about USD 745m each.

Chairite protected area – Western Rhodopi

Chairite is a protected area situated in the Western Rhodopi mountain. It is located some 1600 above sea level, about 20 km away from the village of Trigrad. Some of the most interesting places in the area are the “Piana gora” (Drunken forest) natural phenomenon, and the seven Chairi lakes, which were formed in the Quaternary. The lakes are astonishingly beautiful, with their crystal-clear water and stocks of mountain trout. They are surrounded by over 2000 decares of meadows, which is where the name of the area came from (the word “chair” means “meadow” in Turkish language). One of the lakes, folded in mists and fumes, surrounded by queerly-shaped trees, is called the Magic lake. According to the local legend, it is inhabited by wood-nymphs, who, with their magical songs and enchanting dances, tempt and bewitch shepherds, roaming through the nearby meadows.