Shareholders in Bulgaria’s former state fixed-line monopoly Bulgarian Telecommunications Company (BTC) voted in favour of restructuring the company’s debt, reducing it from 1.7 billion euro to 588 million euro, Bulgarian newspaper Kapital Daily reported on October 9.
At a meeting on October 8, shareholders agreed to the restructuring plan offered by Bulgarian lender Corporate Commercial Bank (CCB) and VTB Capital, the investment arm of Russia’s Vneshtorgbank, picked by creditors earlier this summer to take over BTC.
Creditor banks took possession of BTC in 2010 after its majority shareholder PineBridge Investments (the former asset management arm of US insurer AIG, acquired by Hong Kong tycoon Richard Li) breached bond covenants.
CCB and VTB Capital will acquire 73 per cent of BTC for 130 million euro. The remaining 20 per cent now owned by BTC’s parent company will go to BTC’s creditors, the report said.
After receiving regulatory approval – a process expected to be completed by the end of the year – the new owners will have to make a buy-out offer to minority shareholders, Kapital Daily said.
BTC, which operates under the Vivacom brand, went through three ownership changes after its privatisation in 2004, with each subsequent sale resulting in more debt as the new owners piled the acquision debt onto the company itself. The bulk of BTC’s debt has been contracted as part of its acquisition by AIG from Icelandic tycoon Thor Bjorgolfsson in 2007.