LIC33, a group of EU investors, has confirmed it has agreed to acquire a majority stake in the Bulgarian Telecommunications Company (Vivacom).
“The former owner has irrevocably sold the assets against a commitment from the investor to refinance all…
LIC33, a group of EU investors, has confirmed it has agreed to acquire a majority stake in the Bulgarian Telecommunications Company (Vivacom).
“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,” LIC33 said in a statement.
The debt set to be refinanced totals an estimated €900m.
While the transaction still requires regulatory approval, the new investors say they have already started refinancing and restructuring efforts “with a view to stabilise the situation”.
LIC33, chaired by French private investor Pierre Louvrier, said it intends to work with the Bulgarian government and all other Vivacom stakeholders to refinance and repay debts owed to the failed local Corporate Commercial Bank (CCB), which jointly owned the incumbent telco with Russia’s VTB Capital. CCB has not retained any interest in Vivacom, LIC33 said.
LIC33, which focuses on emerging markets and turnaround situations, intends to hold a press conference in Sofia on 24 March to provide further details on the matter.
In November 2012, CCB and VTB Capital paid €130m to acquire a 93.99% stake in Vivacom from creditors via holding company Viva Telecom Bulgaria. A restructuring agreement with creditors saw the telco’s debt drop from €1.7bn to about €588m.
In 2013, Viva successfully completed a takeover bid for the remaining shares, with the Bulgarian government agreeing to convert its golden share into a common share. Sofia-based Vivacom was also delisted from the local stock exchange.
However, in June 2014, CCB was taken over by the Bulgarian central bank and lost its banking licence a few months later.
Vivacom posted revenues of BGN600.7m (US$327.6m) for the nine months ended 30 September 2014, down 0.8% year-on-year. The company is the largest integrated telco in Bulgaria and the third largest mobile operator after Telekom Austria’s Mtel and Telenor’s local unit.
