BTC sale looking likely

SOFIA (Reuters) – Bulgaria’s dominant telecoms firm BTC said majority owner Advent International and Icelandic tycoon Bjorgolfur Thor Bjorgolfsson, who holds an option on a controlling stake, were discussing a possible sale of the firm. Bjorgolfsson, through his investment arm Novator, has bought a call option on a 65 percent stake in BTC that can be activated after June 11, when a three-year ban on selling the controlling stake expires. Bjorgolfsson bought the option from Viva Ventures, the investment vehicle of Advent that holds the stake. «BTC notes that Viva Ventures and Novator are currently reviewing their strategic options for the 65 percent stake in BTC, which may lead to a sale of that stake,» the company said in a statement yesterday. In a trading outlook note because of the possible sale, BTC said it expected its revenues to grow by 4-5 percent to 1.05 billion to 1.06 billion levs ($733 million-$740 million) this year due to growth in Internet services and mobile subscribers. It said it sees the margin on earnings before taxes falling from 15 percent in 2006, mainly due to the rising cost of sales for its mobile phone operator Vivatel. BTC has forecast a 16 percent drop in net profits to 111.6 million levs this year due to increased competition and falling prices. A source familiar with the planned sale had said Bjorgolfsson short-listed two bidders for the option, estimated to be worth between -1.2 billion ($1.64 billion) and -1.3 billion. The source said Bjorgolfsson would soon choose between Dubai-based Oger Telecom and a US private equity investor for the sale. US equity firm Advent International bought the controlling stake in BTC in a -280-million privatization deal in June 2004. The remaining 35 percent of shares were floated on Sofia’s bourse.