Bulgarian businessman Hristo Kovachki added Municipal Insurance Company to his army of heating utilities, mines, Evropa supermarkets, a bank, insurance company Toplina and a political party.

Through his company LM Impex, Kovachki helped himself to the insurer at the BGN 9.6 million guide price after all other bidders were kicked out over bad papers.

Four companies had purchased tender documents of which Minna Kompania, Evropa and LM Impex all affiliated to Kovachki.

The fourth candidate was Slovenian company Zavarovalnica Triglav.

Although they missed the deadline, the regulator reviewed the papers of Minna Kompania and the Slovenian candidate but discarded them over omissions and the missing data never arrived, said chairwoman Ralitsa Againe.

Thus Kovachki effortlessly won 65.55% of the municipal insurer and is to pay down the BGN 9.6 million price within a month from the nod of the supervisory board of the Sofia Municipal Privatisation Agency.

SMPA chairman Ivan Dimitrov pointed out that this is the highest guide price the agency has ever set.

The municipal stake was estimated at BGN 6.3 million but the agency’s supervisory board raised it by over BGN 3 million.

Two years ago Kovachki acquired 20% in the insurance company buying out the stakes of Energia, Allianz and Avesta Trade.

Municipal Insurance Company is a tasty bite thanks to its licence and sound market positions in spite of its tiny share of less than 1%.

Last year the company reported BGN 14.5 million in assets and BGN 5.1 million in premium income.

Kovachki’s array of firms are all insured with the municipal company, and the businessman holds the blocking quota in Municipal Bank, which is also expected to be sold off in an open-bid tender.

(Dnevnik)

Agriculture and Rural Development European Commissioner Mariann Fischer Boel said in a letter to Bulgaria’s State Agriculture Fund she has proposed a one-year extension of the period in which Bulgaria can use funding under the SAPARD programme.

The proposal is a sign that Brussels has approved of the control measures introduced by Bulgaria and will subsidise 700 projects by BGN 280 million, said the fund’s deputy head, Konstantin Palikarski.

The decision follows a recent visit to Brussels of Bulgaria’s EU funds deputy prime minister Meglena Plugchieva and national SAPARD coordinator Dimitar Ivanovksi, who presented the Commissioner with the reports of auditor Ernst & Young.

Under EU rules, subsidies under pre-accession funds are paid out within two years from the official wrap-up of the programme but Bulgaria and Romania requested an extra one year after joining in on January 1, 2007.

Brussels’s decision gives a breath of fresh air to the Bulgarian government, which recently came under severe pressure by farmers and would have otherwise had to back the approved projects by state money.

(Dnevnik)

Bulgaria’s national power utility NEK will wait till next spring for German company RWE to decide whether it will join the Belene nuclear power plant project in the Danube town of the same name.

The energy ministry has not set a deadline for approval of the shareholders’ agreement which gives the German strategic investor a 49% stake in the project company, said deputy minister Yavor Kuyumdjiev adding that RWE would make a grave mistake if it succumbed to pressure by eco activists.

German newspaper Handelsblatt reported recently that RWE’s supervisory board may postpone the vote on the agreement until 2009 to make sure that the project is not risky and see how what turn the global economic crisis would take.

Meanwhile, Greenpeace urged the German company to quit the project.

If the plant failed to attract funding, the state may dip into the EUR 12 billion foreign exchange reserves, Kuyumdjiev said.

He probably meant the fiscal reserve of BGN 12 billion. The forex reserves are just above EUR 14.2 billion, under data of the central bank.

As a last-ditch option, the nuclear plant will be funded by Russia.

Economic parliamentary committee chairman Yordan Tsonev declined that the government has ever discussed funding infrastructure projects by the fiscal reserve.

(Dnevnik)

Kontrax, the Bulgarian provider of software applications, cable systems and office furniture, has signed a contract with local DSK Bank to collect and export used toner cartridges, the company said during the BAIT Expo running in Sofia.

The contract is in line with a joint initiative aimed at protecting the environment and creating a waste-free banking administration.

“The bank is our customer and has 365 offices throughout the country. Each year it uses 250 tonnes of printing device cartridges, which makes some 20 trucks packed with waste,” Kontrax president Yordan Yordanov told Dnevnik.

Under the contract, Kontrax sends for recycling one truck loaded with used cartridges to a Hungarian partner.

Less than 10% of the disposed toners in Bulgaria are collected and refilled by shady companies, and the remainder is thrown out, according to Yordanov.

If more contracts follow, Kontrax may spend some EUR 500,000 to build its own toner recycling line, Yordanov said.

(Dnevnik)

Investors have slowed down or halted industrial and logistics centre projects in the face of administrative hurdles and a worsening global financial market, showed a research of property consultants Colliers International.

The projects’ fate will be decided in the next three or four months, said Simeon Mitev, manager of real estate agency RE/MAX Chance Group.

A humble 23,000 sq m of speculative logistics areas entered the Sofia market in the first half of the year, under data by Colliers.

Demand for modern industrial space is still high and outstripping supply, said Mitev.

Construction is booming in villages, small towns, outside the capital, in old urban zones and along key transport corridors.

Investors are battling speculative plot prices, a falling number of plots with good location, and heavy red tape.

Good plots outside the urban infrastructure zone near Sofia Airport are offered at over EUR 1,000/sq m, said Hristina Angelova of Yavlena Real Estate.

The warehouse market is dominated by freight-forwarding companies and FMCG retailers, who seek to rent some 2,000 sq m at good infrastructure, according to Colliers.

Rental prices of renovated storage space may dip if new projects enter the market, forecast Raiffeisen Real Estate.

(Dnevnik)

Local lenders have committed 44 violations of banking legislation and central bank regulations from January to June, the Bulgarian National Bank said in a report.

Banks blundered 57 times last year.

The bulk of the naughty banks ignored loan assessment and classification requirements and covered up exposure equaling or exceeding 10% of their equity capital.

Others did not report connections between loan borrowers forming big exposure.

The central bank presented 102 recommendations to the control and management bodies of the checked lenders.

One lender let its total capital adequacy ratio slip close to the regulatory bottom of 12%.

Another was imposed regulatory restrictions on lending.

Active lending has resulted in reporting capital violations triggered by disregard of the growth rates of credit portfolios and capital, the central bank said in the report.

The Bulgarian banking sector maintained a high level of public confidence in an unfavourable international environment and an attempt at discrediting one of the major banks in May 2008, the central bank said.

(Dnevnik)

After a brisk boost Bulgarian stocks went back to the recent trend of scanty turnover and steep drops.

Global indices continued to grope for a new bottom after on Wednesday the Dow Jones Industrial Average registered its lowest post-election decline, and some Asian indices nosedived more than 7%.

The key indices of the Bulgarian stock exchange fell over 3% on Thursday with the blue-chip SOFIX closing at 472 points and the broader BG40 down to 140.57 points.

Dnevnik 20 slid to 70 points and BGTR30 of the companies with the highest market capitalisation and liquidity retreated to 354.7 points.

Only BGREIT of the property funds trimmed its loss to less than a percentage but deals were sporadic.

Four blue chips did make gains but no bigger than 1.5%.

Investors dumped Central Cooperative Bank dragging its shares over 8% to BGN 1.3.

Industrial conglomerate Chimimport ended over 5% lower at BGN 2.9.

(Dnevnik)