ECONOMY

Bulgaria extends deadline

SOFIA (Reuters) – Bulgarian state tobacco firm Bulgartabak has extended a deadline for final bids in the sale of four cigarette mills until the end of October so investors can have more time to submit offers. The Balkan state put Bulgartabak’s four best performing cigarette-making factories on sale in July in a deal key to the country’s efforts to restructure its economy and liberalize its tobacco market ahead of EU accession in 2007. Three global cigarette majors, British American Tobacco, Imperial Tobacco and Philip Morris, are preparing final bids for the four factories. But earlier this week an industry source said BAT had asked for the original September 30 deadline to be pushed back. «Taking into account the short time given for due diligence and the need for deeper analysis of the plants up for sale, the Supervisory Board has extended the deadline for placing offers to October 29,» the company said in a statement yesterday. Bulgartabak is offering the four plants in two packages – each to go to a separate bidder – and expects revenues worth at least their market capitalization, or 490 million levs ($306.3 million). The poor Black Sea state has said it hopes to close the deal by end-2004. Bulgartabak is Bulgaria’s most sensitive sell-off of state assets since the fall of communism, as most of the country’s 10 percent Turkish minority work in the sector and every second Bulgarian smokes. The company, which has 22 domestic subsidiaries, is also selling its 12 tobacco-processing plants and a packaging plant. It also has five other cigarette-making plants, but it plans to strip them of their production licenses after the sale is concluded. If these and the processing units fail to attract potential investors, they will be closed. Some 1,000 of Bulgartabak’s 8,000 workers are expected to be laid off after the sales.