Bulgaria's privatisation authority and the local Balkan Hemus Group Thursday signed the contract for the sale of Bulgaria Air, a company created as a legal successor of one-time national flag-carrier Balkan Airlines. Balkan Hemus Group pays BGN 13 mln in cash for the 99.9 per cent stake and commits to invest a further EUR 81.5 mln over the next 5 years. The new owner will also increase the capital of the carrier by BGN 20 mln to BGN 30.1 mln. Balkan Hemus Group is wholly-owned by foreign trade company Chimimport, itself 98 per cent-owned by Liechtenstein-registered Chiminvest Institute. According to unofficial information, Bulgaria Air, which flies to 14 destinations, owes some BGN 50-60 mln and is owed a further BGN 10-15 mln. Bulgaria Air will be merged with Hemus Air but no sooner than 2008, said Balkan Hemus Group executive director Mirolyub Panchev. The new company will retain the name Bulgaria Air. 'We'll be neither a low cost nor a regional carrier but we will operate as a budget carrier for destinations where we compete with low cost rivals,' said Dimitar Pavlov, the managerial agent of Bulgaria Air. The new owner will resume in 2007 the discontinued Bulgaria Air flights to Belgrade, Kiev, Istanbul and Kuwait. Depending on the market environment, routes to the US and Canada are also possible, said Pavlov. The combined market share of the two carriers is 35 per cent and the new owner will aim for 40 per cent. Talks are underway with Airbus and Boeing for the purchase of new passenger jets. The two carriers have a total of 22 jets in their fleets, including 11 jets leased by Bulgaria Air.
Source: Dnevnik (05.01.2007)

Bulgaria's Commission for Protection of Competition (CPC) has given a green light to Balkan Hemus Group to acquire control over national flag carrier Bulgaria Air. Balkan Hemus Group, the owner of Hemus Air, was selected for the buyer of 99.99% in Balkan Air in November 2006. The deal will not result in the establishing of a dominant position on the market, according to CPC experts. Dimitar Pavlov, executive director of Hemus Air, who is also the procurator of Bulgaria Air, will continue to manage both companies after the transaction, according to Pari daily's sources.
Source: Pari (11.01.2007)

The Bulgarian Commission for the Protection of Competition (CPC) gave green light to the sale of the national flag carrier Bulgaria Air to Balkan Hemus Group. Thus, Himimport acquired 99.9 per cent of the capital of the company. According the CPC, the stipulated investments in the contract will ensure better quality of services and raise the competitiveness of the company. The deal will also have positive effect on Bulgarian tourism. The concentration of financial resources will permit the two companies to maintain high safety standards - one of the main requirements for applying for a European license, reads the press release.
Source: Standart (11.01.2007)

Varna-based business conglomerate TIM is in talks to buy BM Star, the local company that was awarded a 35-year contract to run the airports in Varna and Burgas in partnership with Germany's Fraport. Varna-based BM Star is wholly-owned by Bon Marin, a company controlled by local businessman Georgi Bonin. Bonin confirmed for Dnevnik the talks with TIM representatives but said the company is still his. The concession arrangement bars Fraport from lowering its 60 per cent stake in the parternship for the lifespan of the contract. TIM's interest in the Burgas and Varna airport is a natural progression from its purchase of national flag-carrier Bulgaria Air via Balkan Hemus Group. Balkan Hemus Group will pay BGN 13 mln for Bulgaria Air and merge it by 2008 with its own carrier, Hemus Air. In related news, the Bulgarian stock exchange said TIM-controlled holding company Chimimport has acquired 99 per cent of BM Port, a company that operates Black Sea port Lesport under a concession contract, from Bon Marin. The deal was finalised in late 2006 and is part of Chimimport's strategy for investment in this sector, said Chimimport executive director Ivo Kamenov, withholding the price of the transaction. BM Port received the 35-year Lesport concession contract in 2005, committing to invest at least BGN 129 mln in the facility. TIM is also associated with Port Balchik, the operator of another Black Sea port, Balchik.
Source: Dnevnik (15.01.2007)

Air carriers Bulgaria Air, Hemus Air and Viaggio Air, owned by Balkan Hemus Group, will be deloped under a new strategy, Dimitar Pavlov, executive director of Bulgaria Air and Hemus Air said. Improving the regularity of the flights will be among the main priorities of the new strategy. The upgrade of the fleet of the companies, including aircraft interior refurbishing, will be completed soon. In addition to the global markets, the three companies will also try to expand their operations in Bulgaria. The three carriers are expected to merge within the next two years increasing their share of the domestic market. Bulgarian companies will be the ones generating the aviation market growth, according to Hristo Todorov, deputy executive director of Bulgaria Air and Hemus Air. The positions of the European carriers operating in Bulgaria will be frozen, according to Todorov. Bulgarian companies will also be able to offer competitive fares on destinations serviced by European low-cost carriers operating domestically.
Source: Pari (20.03.2007)

Bulgaria's flag carrier Bulgaria Air, which was privatised by Balkan Hemus Group in November 2006, returned to profit in the first quarter of 2007, Dimitar Pavlov, procurator of the company said. Pavlov is also Bulgaria Air's executive director as of Monday. The new board of directors of the company has been elected as well. The board is chaired by Ivo Kamenov, one of the shareholders in Chimimport, which in turn owns Balkan Hemus Group. Balkan Hemus Group assumed over BGN 63 million debt upon acquiring Bulgaria Air, Pavlov said. Bulgaria Air transported 20.4% more passengers in the first quarter of 2007, compared to the corresponding period of 2006, Pavlov said. Balkan Hemus Group has fulfilled its commitment to raise the capital of the company by BGN 10 million after the privatisation. The capital of the company currently stands at BGN 30 million. Bulgaria Air, Hemus Air and Viaggio Air are expected to merge in 2008. The new megacompany will subsequently be listed on the Bulgarian Stock Exchange.
Source: Pari (24.04.2007)

Local holding company Chimimport, controlled by Varna-based business conglomerate TIM, will raise its capital through a share sale in 2007, said executive director Ivo Kamenov. The hike proposal will be voted on at a June meeting of shareholders. The raise could be performed in September. The capital of the holding company currently stands at BGN 130 mln. The management is authorised to raise the capital to BGN 150 mln over a 5-year period. Chimimport Invest, the Chimimport majority owner, has no plans to slim its current shareholding of 85 per cent in 2007, said Kamenov. The free float of the holding company could be boosted to 25 per cent no sooner than 2008. Chimimport plans to complete the consolidation of its grain businesses by July this year. Nine subsidiaries active in the grain industry, including Sunny Rays Bulgaria and Zarneni Hrani EAD, will be merged into a new company, Zarneni Hrani Bulgaria, with a capital of BGN 150 mln. Zarneni Hrani Bulgaria, set for a bourse listing by October this year, will manage 21 grain silos with a combined storage capacity of 1 mln tons, said Alexander Kerezov, deputy chairman of the Chimimport managing board. Bulgaria's 2006 grain crop topped 3 mln tons which means the new Chimimport unit would be able to store a third of the nation's grain. Sunny Rays Bulgaria is currently building a biodiesel factory in Provadia. The first trial volumes of fuel will be produced in August, said George Kostov, the Sunny Rays executive director. The Chimimport expansion will also cover finance and transportation. The Central Co-operative Bank, controlled by wholly-owned Chimimport company CCB Group Assets Management, will convert into capital the 2006 profit of BGN 11.9 mln, said the lender's executive director Lazar Iliev. The bank will also perform a capital raise with yet unspecified parameters. Insurer Armeec, another CCB Group Assets Management company, will also covert last year's profit of BGN 17 mln into capital. The company plans to incorporate a life insurance arm in partnership with France's Groupe AG2R. Armeec, likely to list on the Bulgarian stock exchange in 2008, recorded premium income of BGN 58 mln in 2006 and should improve that performance to BGN 60-65 mln in 2008, said executive director Rumen Georgiev. The consolidation of the holding's pension insurance businesses will involve the merger of newly-acquired pension insurance company Lukoil Garant with peer CCB Sila. CCB Asset Management intends to launch its first mutual funds by mid-May. The asset management company will run one high-risk, one balanced and one low-risk scheme. The consolidation of the holding's aviation businesses will also get underway in 2007, said Dimitar Pavlov, executive director of air carrier Hemus Air. Bulgaria Air, the national flag-carrier purchased by Chimimport-controlled Balkan Hemus Group in 2006, has run up a loss of BGN 29 mln for the past 3 years with debts totaling BGN 63 mln. Chimimport will also continue to develop BM Port, the company operating the Lesport harbor in Varna under a concession arrangement. The holding has no plans to beef up its 25 per cent stake in the Odessos ship repair yard. Kerezov said Chimimport will not participate directly in the upcoming privatisation of national maritime fleet NMB but did not rule out the possibility that it may team up with some of the other candidates.
Source: Dnevnik (24.04.2007)

Chimimport, Bulgaria's biggest holding company, said group profit jumped more than 14 times year-on-year to BGN 25.29 mln in the first quarter of 2007. Profits were mainly lifted by gains on financial assets and instruments and improved revenues from services, shows the consolidated financial report of the company. During the review period, Chimimport pocketed one-off proceeds from the sale of an 8 per cent stake in central Co-operative Bank which were disposed by holding subsidiaries. The net income from financial instruments was reported at over BGN 26 mln, a significant bounce-back from the 282,000 loss recorded a year ago. Sales were reported at BGN 53.7 mln, up from BGN 23 mln a year ago. Profit from insurance operations fell to BGN 439,000 which represents almost a fourfold year-on-year decline. Interest income jumped 56 per cent to BGN 20.6 mln.
Source: Dnevnik (01.06.2007)

Germans plan to repair airplanes Boeing and Airbus aircraft in Bulgaria. The Germany-based aircraft overhauler Lufthansa Technik Group wants to establish in Sofia a joint venture for aircraft maintenance and repair together with the Bulgarian Aviation Group (BAG). The Bulgarian Aviation Group owns the united Bulgarian air-carriers Hemus Air, Bulgaria Air and Viaggio Air. The finalization of the deal was initially scheduled for August 16, but it was later postponed for September due to health problems of one of the directors of the foreign investor. The Germans will hold an eighty-percent stake at the Lufthansa Technik Bulgaria, and their Bulgarian partners - twenty percent.
Source: Standart (13.08.2007)

Nearly EUR 20 million will be invested in the aviation base at the Sofia airport, Dimitar Pavlov, executive director of Bulgaria Air and Hemus Air, told the Pari daily. A join-venture company for the joint use of the base is expected to be established next week between the shareholders in the two companies and Lufthansa Technique. The German company will hold an 80-percent stake in the new joint-venture, while Bulgaria Air, Hemus Air and Viaggio Air will own the remaining 20%. An additional 380 workers will be employed after the modernisation of the aviation base. The facility will repair Boeing 737 and Airbus 320 aircrafts.
Source: Pari (13.08.2007)

The national flag carrier Bulgaria Air will launch regular flights Sofia-Istanbul in October, said company’s CEO Dimitar Pavlov. By the end of year the Aviation Company will open also regular lines to another two Balkan’s capitals – Belgrade and Skopje. The flights to the new destinations will be offered four times a week. Currently the flag carrier offers flights to Athens, Tirana and Bucharest. The opening the new destinations will turn Bulgaria Air into a Balkan “shuttle”.
Source: Monitor (11.09.2007)

Aviation company Bulgaria Air posted a profit. These are the advanced results for the period January-September 2007, the procurator of the national flag carries Mr. Dimitar Pavlov said. In the end of 2006, when Balkan Hemus Group went private, Bulgaria Air reported a loss of over BGN 14 mln. Within a few days the company is to open regular line Sofia – Istanbul, and will connect Bulgaria with two more Balkan capitals – Belgrade and Skopje. The flights to the new destinations will be performed four times a week.
Source: Monitor (04.10.2007)

Bulgaria Air, a Balkan Hemus Group company, said it will either hire or purchase two or three passenger jets by the fall of 2008. The carrier currently operates a fleet of ten Boeing 737s. One of the plane leases runs out in late 2008 with a second one due to expire in early 2009. Balkan Hemus Group, owned by Varna-based business conglomerate TIM, plans to completely renew the Bulgaria Air fleet within five to ten years. Within a decade, the carrier should be operating 25 jets, including nine that are company-owned, said managerial agent Dimitar Pavlov. A program for the restructuring and merger of Bulgaria Air and the other two group air carriers – Hemus Air and Viaggio Air, will be drafted by Lufthansa Consulting by the end of 2007. Most of Bulgaria Air’s debts that the new owner assumed with the purchase of the carrier have been settled. The national flag-carrier was 60 mln levs in the red at the time it went private.
Source: Dnevnik (16.10.2007)

The net profit of Bulgaria's Chimimport for the first nine months of 2007 increased by BGN 64.7 million, year on year, to BGN 90 million, the company's consolidated report shows. The profit jumped 3.65 fold from BGN 24.4 million for the year-ago period. The holding's operating profit rose 2.7 fold, reaching BGN 100.9 million. That was mainly due to income from services, which amounted to BGN 128.7 million at the end of September, compared with BGN 88.5 million a year earlier. Chimimport's net sales rose by BGN 66.8 million to BGN 233.6 million for the first nine months of 2007. Business expenses increased from BGN 206.4 million to BGN 273.2 million. The main reason for that was the BGN 11.4 million jump in payroll expenses to BGN 30.7 million.
Source: Pari (05.12.2007)