Four candidates submitted proposals for valuation of the Bulgarian Stock Exchange (BSE) the Central Depository (CD) (07.01.2014)


Four candidates submitted proposals to make the valuation and prepare the privatization procedure for the BSE and the CD according to the Privatization and Post-Privatization Control Agency. The deadline for submitting the proposals was 6th of January. The Agency has two weeks to produce an official statement and present it to its executive board. This deadline can be extended if there are any queries concerning the proposals, thus it is expected the final choice of candidate to be announced by the end of January.

The proposals were submitted by three associations and one single player. The first association consists of Consortium “Kamburov-European Program - Advisory Mane Capital”, “First Financial Brokerage House” and law firm “Cvetkova, Bebov and Co. LLP” and partnership of ”EY Bulgaria” with law firm “Subev and Co. LLP”. The first association is already involved in the previous valuation of the BSE and CD, which was interrupted by the resignation of the Prime Minister Boyko Borisov in 2013. Mane Capital, a boutique investment bank, was previously part of the Bulgarian branch of KBC Securities and was actively involved in the valuation along with Patria Corporate Finance. “European program advisory” is owned by Vassil Karaivanov, economist and lecturer at Sofia University. “Kamburov and Co.” was actively involved in the valuation of "BDZ Freight Services" Ltd. and other privatization valuations.

“Deloitte Bulgaria” and “BullBrokers Consulting” were excluded from the competition during the previous tender offer. “KPMG Bulgaria”, “First Financial Brokerage House”, “CMC Cameron McKenna”, “KBC Securities Bulgaria”, (which were then indirectly involved in the project with their Czech partners and winners of the tender procedure Partia Corporate Finance) and the Bulgarian LPCs “Subev & Partners” and “Georgiev and Co.” were interested but decided not to participate in the auction.

The fourth candidate is the unknown “Give Consult”, which is owned by Ioannis Giofkos (Greek citizen), who was involved in the scandal associated with the restitution of the 70 decares of Kniazhevska forest in the period 2007-2008, that was supported by the former Sofia Regional Governor Todor Modev. Giofkos also partook in a consortium with a firm of the wife of the former deputy Interior Minister at the time of the ruling coalition Kamen Penkov-Vaska. At the moment Penkov’s son-in-law is Chief Secretary of the Interior Ministry.

Candidates that can participate in the procedure of the Privatization and Post-Privatization Control Agency for the privatization of the BSE (50.05%) and the CD (43.70%), should have previous successful privatization procedures in the last 10 years and at least one of these procedures should have been above BGN 50m.

What is next?

The candidates will be weighted mainly by quality and price and less so on timeliness of delivery. The winner will be announced by the end of January.

The privatization process will be based on the valuation made by the winner and is currently one of the key objectives of the government. International competitors will not be allowed to participate in the process.


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