site.btaFirst Investment Bank Intends to Support Inercom's Purchase of CEZ Group's Bulgarian Assets by EUR 80 Mln

Sofia, April 12 (BTA) - On December 19, 2017, First Investment Bank (FIB) issued a letter expressing an intention to support Inercom Bulgaria purchase of the Czech CEZ Group's Bulgarian assets by 80 million euro, BSP for Bulgaria MP Zhelyo Boichev told a news conference in Parliament on Thursday.

At the news conference, Boichev, who chairs a parliamentary Ad Hoc Committee of Inquiry into the Facts and Circumstances Surrounding the Privatization and Planned Sale of the CEZ Group Companies in Bulgaria, read a letter from FIB to the Committee, stating that the bank was informed by Inercom's consultant that on November 30, 2017 the Bulgarian company was preferred by CEZ as a buyer on the basis of a binding offer.

The Left MP added that a couple of weeks ago his Committee wrote to the Bulgarian Development Bank (BDB), requesting the bank's entire correspondence with Inercom about the forthcoming transaction with CEZ. So far, the letter remains unanswered. If the BDB does not reply, the Committee will approach the Bulgarian National Bank for assistance.

Boichev also said that, asked about their part in the deal, UniCredit Bulbank answered that this matter is covered by professional secrecy and declined to comment.

CEZ's announcement that it had decided to sell its Bulgarian electricity distribution business to an obscure local company, Pazardjik-based Inercom Bulgaria, wholly owned by Ginka Vurbakova, triggered a political turmoil in this country. While the selling price of the assets has not been formally disclosed, media reports set it at 342.5 million euro.

Czech daily "Lidove Noviny" reported in late February that Inercom's offer for the CEZ business in Bulgaria specified three ways of financing: own funds, bank guarantees, and loan agreements with offshore companies. The daily found out that, according to information available to the CEZ management, up to 260 million euro of the price was expected to be provided by two private banks in Bulgaria: UniCredit Bulbank (180 million euro) and FIB (80 million euro). According to the materials available to CEZ, the State-owned BDB was supposed to take care of the refinancing of outstanding loans extended to CEZ by the European Bank for Reconstruction and Development. Another substantial portion of up to 187 million euro was expected to come from a company "with a shady origin of assets": Score Trade and Global Victory Trust. Yet another company that is responsible for one of the bank loans concerned is Euro Star OOD, "Lidove Noviny reported".