THE TARGOVISTE BASED VINTNERS ARE LOOKING FOR BGL3MN FOR THE NEW VINTAGE
The Targoviste based vintners LVK Vinprom are already concerned with finding financing for the new vintage buy up campaign. The shareholders voted the bond loan issue for the amount of BGL3MN. Bonds will be offered to institutional investors only. According to Petko Mateev, company Executive Director, that will be cheaper than the bank credits the company has been using till that moment. The interest for the debt papers is expected to reach 8 - 12%. The shareholders voted also the company's writing off the Register of the public companies, kept at the State Securities Commission (SSC). The move is legitimate, as the company's capital amounts to only BGL167,924. While the Public Offering of Securities Act allows the writing off of companies, whose capital amounts to BGL200,000.
LVK Vinprom 2000 financial results show that income from sales was reduced from BGL17.754MN to BGL15.496MN. The reduction was a result of the lost Russian market and the shrinking local wine market. Executive Director Mateev thinks that only an intergovernmental agreement between Russia and Bulgaria may re-establish the company's position at the that market. Totally 84% of the Targoviste based producer sales in 2000 were at the local market. LVK Vinprom exports production to Germany, Poland, Vietnam, Sweden, UK, Danemark, Belarus and the USA. Another problem, last but not least, which the company faces, are the continuously reducing vine yard areas in the district of Targoviste.
Till now the vintage buy outs were financed by HipoVerrains Bank and BNP Paribas. The credit which the company has already received by the French bank amounts to BGL2MN and is due by September 2001. HypoVerrains Bank has launched a credit of BGL5MN. It is due till March 2002. Credit repayments are due monthly, and this is the biggest problem for us in using bank credits, thinks Mateev.