Банкеръ Weekly


Voucher Booklet Still Hides Secrets

Sixteen years ago, the green voucher book became one of the symbols of the booming Bulgarian business climate. Then, over three million people bought 25 thousand investment bonds, lured by the dream to get something from the privatization of old state entities to buy and sell their shares and, of course, to receive dividends from profits as well as possibly participate in their management.

The reality was very different. Most Bulgarians took part in the mass privatization through the then specially created privatization funds. In 1998 they were transformed into holding companies and placed their shares on the Bulgarian stock exchange.

The fate of most of them was not very rosy. It became clear that not all had reasonable plans for the future. And over time, most of these companies were liquidated (shareholders lost their property) and continued their activities in another form.

Today, shares of only 30 of the 81 privatization funds are still present on the stock exchange. So everyone who has given to them their bonds ten years ago now has a number of securities of a holding company. These shares may be sold at any time. In December, a dozen of holdings' share quotes reactivated the attention of investors and the deals in them revealed what the present value of the investments in these securities is.

A voucher book can still be transformed into real money. Enough holder to take initiative and took documents from the archive. In this case there are several possibilities.

First of all people can get money by selling shares on the stock exchange. Information about the status of listed companies is published daily on the website of the bourse, on the one of the Commission for Financial Supervision, and several other financial sites that have the right to do so. At any time people can check the price of a share and calculate how much money they can make if they sell. At the end of last year the highest quote was that of Holding Varna - 5.59 levs per share. Shares of Albena Invest - Holding JSC cost 5.15 levs per share, followed by Nov Vek Holding with a unit price of 05.03 levs.

A different question is whether the time is now ripe for transactions in such shares. After 2008 their prices fell sharply and are now much lower than a year earlier.

If the holding company is not traded on the stock exchange, there is no way to know the market price of its shares now. And the information is limited. There is no way to know whether any of the other shareholders are willing to increase their share. Basically these securities are being traded on the OTC market which is determined by agreement between the two countries. Investors in a non-public company can profit when the firm distributes dividends.

The worst scenarios is when the company is liquidated. If the procedure is not completed, the shareholders may request their liquidation shares, i.e. to receive part of the company's assets. But no shareholder can take advantage of this opportunity if time has expired.

If people choose not to sell the shares now, whether their company is public or not, it is very important that they check if the company has distributed dividend. This happens if the company is profitable and if the General Assembly decides to carry out dividend payments.


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