July 12, 2019 / 2:19 PM / a month ago

Bulgaria telecoms firm Vivacom expects for indicative offers by end-July

SOFIA, July 12 (Reuters) - Bulgaria’s leading telecoms operator Vivacom has been put up for sale and indicative offers are expected by the end of July, two sources familiar with the process said on Friday.

Vivacom’s main shareholder, Bulgarian businessman Spas Roussev, confirmed that a sale process was underway and Lazard had been hired to handle it.

A consortium led by Roussev took control of Vivacom from Russia’s VTB Bank after bidding 330 million euros ($371 million) for it in an auction in 2016. The consortium also took on 450 million euros of Vivacom’s senior debt at the time.

“Non-binding offers are expected by the end of the month,” one source, who wished not to be named, said.

Another source familiar with the process confirmed the timeline and added that over a dozen interested parties have signed non-disclosure agreements and received a detailed investment memorandum.

According to market sources, Vivacom’s enterprise value could exceed 1.2 billion euros ($1.35 billion), including net debt of about 600 million euros.

At present, Roussev has a 46 percent stake in Vivacom, VTB holds 20 percent minus one share, while a further 19 percent is held by Delta Capital, controlled by the managers of the Bulgarian office of VTB Capital. The rest is held by former creditors of Vivacom.

The auction sale in 2016 has been contested at an English court by Empreno Ventures, a company of the Russian businessman Dmitry Kosarev.

Vivacom said the English Commercial Court had dismissed Empreno’s claims over the sale.

“This company was acquired through an entirely legitimate competitive sales process. The claimants have tried to challenge the transfer of ownership in a variety of ways ever since. They have failed,” Roussev said in a statement.

Empreno Ventures was not immediately available for comment.

Vivacom, with total assets of 1.7 billion levs ($978 million), ended 2018 with a net profit of 128 million levs, up almost 80% from a year ago, its consolidated report showed.

Its adjusted earnings before interest, taxes, depreciation and amortisation rose 12.8% year-on-year to 360 million levs ($207 million) in 2018.

$1 = 1.7390 leva $1 = 0.8890 euros Reporting by Tsvetelia Tsolova; editing by David Evans

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