site.btaEurohold Granted Exclusivity in Talks on Acquisition of CEZ' Assets in Bulgaria

117 - ECONOMY - CEZ - BULGARIA - EUROHOLD

Eurohold Granted Exclusivity in Talks on
Acquisition of CEZ' Assets
in Bulgaria


Sofia, April 17 (BTA) - Czech energy group CEZ has granted Eurohold exclusivity in further negotiations in the acquisition of CEZ' Bulgarian assets, the Czech daily Lidovky reported on Tuesday. The story says that with this decision the Indian Power consortium falls out of the game as a bidder and CEZ's withdrawal from the Bulgarian market enters a new phase.

The paper recalls that last week CEZ ended negotiations with Inercom, the first bidder for the CEZ assets with which it signed a tentative contract early last year. The deal with Inercom was blocked by a negative opinion of the national anti-trust authority.

It is not yet known how much Eurohold offers for the CEZ business in Bulgaria.

According to Lidovky's sources, the offer was more attractive than the Indian investors'.

Inercom offered 355 million euro for the Bulgarian networks. The problem with Inercom was that it was a little-known company and there were doubts about the origin of money it would have used for the CEZ deal, the story says adding that the tentative deal caused much turmoil and a political earthquake in Bulgaria last year.

The story points out that Eurohold Group is a more established company on the Bulgarian market than Inercom. However, it has no experience in the energy sector: it deals with insurance, financial services, leasing and car sales. Its shares are sold on the Sofia Stock Exchange.

The entry of Eurohold in the talks with CEZ has prompted lots of speculations in Bulgaria as to who would be the real "financier" of the expensive operations worth several hundred million euros, and the name that is most often heard is the Russian bank VTB Capital, whose branch in the Bulgarian capital is controlled by former Finance Minister Milen Velchev, says the story. LN/