site.btaLIC33 Group of Investors Acquires Majority Stake in Vivacom Telecom

LIC33 Group of Investors Acquires Majority Stake in Vivacom Telecom

Brussels/Sofia, March 18 (BTA) - LIC33, a group of companies
gathering European Union investors specialized in emerging
markets and distressed situations, takes over a majority stake
in Vivacom and other leading companies in Bulgaria, the company
told BTA on Wednesday. Vivacom is the brand name of the
Bulgarian Telecommunications Company EAD (BTC), the largest
telecommunications company in Bulgaria and a former state-owned
monopoly.

The former owner has irrevocably sold the assets against a
commitment from the investor to refinance all debts due to the
various banks vested in the situation. The initial estimation of
 the consolidated debts to be refinanced is EUR 900 million.

The recent transaction is waiting for regulatory approvals and
the new investors have already started the refinancing efforts
along with the re-structuring efforts - with a view to stabilize
 the situation.

Vivacom posted EBITDA of EUR 175 million in the year 2013, the
press release says.

The EU investor counts on a strong support from the government
of Bulgaria to guarantee the rule of law in this situation. It
is the investor's intention to work with the government and all
other stakeholders in order to refinance and repay the debts
owed to Corporate Commercial Bank (Corbank).

On June 20, 2014, having suspended all operations after a panic
run by depositors left it illiquid, Corpbank (Bulgaria's fourth
biggest lender) was placed by the Bulgarian National Bank (BNB)
under special supervision for a maximum of six months to allow a
 thorough audit and possible restructuring. The BNB Governing
Council withdrew Corpbank's banking licence on November 5, 2014,
 and the bank's bankruptcy was petitioned on November 7.

LIC33's press release also says that Chairman of the company is
Mr Pierre Louvrier - a private investor who has specialized in
distressed and special private equities for 15 years. He has
participated in multiple complex situations in France, Georgia,
Russia, Belgium and Italy. Mr Louvrier worked before for
Accenture and Arthur D. Little.

Meanwhile, in Sofia the Commission for Protection of Competition
 (CPC) said that no information has arrived in it about the
changed ownership in Vivacom, CPC Spokesman Mario Gavrailov told
 BTA, noting that it was however possible for the EU regulatory
authorities to have been notified of such a transaction.

On February 20 the CPC sent to the European Commission's
Directorate General for Competition a case of possible
concentration through acquisition of control of the BTC. In an
alert made to the CPC, the Technology Center - Institute of
Microelectronics AD (TC-IME) assumed that a  concentration
through acquisition of control of BTC had taken place.

The CPC found that a possible transfer of shares from Bromak
Telecom Invest AD to SHCO 79, registered in Luxembourg, would
lead indirectly to a change in BTC's ownership.

In November 2014, TC-IME signed an agreement with the now
defunct Corpbank whereby the bank's shares in Bromak Telecom
Invest were transferred to TC-IME.

However, following Corpbank's closure in mid-2014, in July
Bromak Telecom Invest reportedly transferred its stake in V
Telecom Investment to SHCO 79. TC-IME pointed out that it was
not informed of the transfer of Vivacom shares to SHCO 79 and
requested an inquiry into the deal.

The case file was sent to Brussels because the turnover in 2013
(the year preceding the alleged transfer) of at least two
companies involved in the deal was above the threshold laid down
 in EU legislation. Above that threshold, control of
concentrations falls within the jurisdiction of the European
Union.

The CPC cites Council Regulation (EC) No 139/2004, under which
GD Competition handles cases of concentration with a Community
dimension, i.e. concentrations  which meet the turnover
thresholds.

Under Article 21(3) of the Regulation, "No Member State shall
apply its national legislation on competition to any
concentration that has a Community dimension."

Having found that the transaction, if it is a fact, would fall
outside the ambit of the national legislation, the CPC concluded
 that it cannot make an assessment whether the deal is a
concentration and how it might impact competition.