Sofia to sell state plants next year

SOFIA – Bulgaria will not be able to sell state-owned tobacco monopoly Bulgartabak until next year due to legislative difficulties, Economy Minister Rumen Ovcharov said yesterday. In January, Ovcharov said he hoped Bulgartabak’s four cigarette plants could be sold by the end of June, but yesterday he said the sale was likely to be postponed as the government has delayed the legislative amendments needed for the deals. The Socialist-led cabinet failed to approve amendments to the privatization law under which the holding company and two of its cigarette makers could be sold without a special strategy. «Bulgartabak will probably be left for privatization in the coming year and I do not know what its condition will be at that time,» Economy Minister Rumen Ovcharov told reporters after the government meeting. The amendments could be approved next week, he said. Bulgartabak has been under serious pressure since January 1, when Bulgaria joined the EU, as major producers have flooded the country with cheap, high-quality cigarettes. Sofia had wanted to sell the plants before joining the EU but political wrangling had led to the failure of three attempts to sell them to strategic investors. The last attempt failed in 2005 when British American Tobacco withdrew its -200 million bid after the ethnic Turkish MRF party, a junior coalition member in the previous and present government, blocked the deal. State-owned Bulgartabak, which holds an 80 percent stake in the mills in Sofia, Stara Zagora, Plovdiv and Blagoevgrad, has not yet decided whether to sell them through the Bulgarian Stock Exchange or seek strategic investors.

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