Two UAE Investors Buy 38% Stake in Bulgartabac Holding

Bulgarian diversified group Bulgartabac Holding on Wednesday announced that the UAE-registered Tala Ltd, has acquired the entire 14.75% stake in the business held by Lichtenstein-registered Stiga Anstalt.

Tala purchased 1,086,595 shares in the Bulgarian group after Stiga Ansalt divested the same number of units on December 22, Bulgartabac Holding said after close of trading on the Bulgarian Stock Exchange on Tuesday, without disclosing further information.

The announcement of the transaction came on the same day when Bulgartabac said that the Liechtenstein-based Woodford Establishment has sold its 24% ownership (1,768,133 shares) in the holding to Monoceros Ltd, another company registered in the UAE. Woodford Establishment, is the second-largest investor in the Bulgartabac

Bulgartabac Holding Group is a Bulgarian tobacco holding company. Established in 1947 and based in the capital Sofia, it includes 11 joint-stock subsidiary companies in the tobacco-growing regions of the country. Bulgartabac produces over 50 cigarette brands, monopoly of product.

The former global tobacco player, which by the late 1960s was the number one tobacco exporter in the world, was already in decline BY 1980s. Bulgartabac continued to play a major role in the international markets, but the protracted privatisation led to its slow decay.

Privatisation

It was finally privatised in 2011 by Bulgarian MP Delyan Peevski-related firms after the sale had been consistently thwarted for years by the party of which he is a member.

The official reason for MRF’s resistance was concern about jobs, as many of the party’s voters – Bulgarian ethnic Turks – were employed in tobacco production. The put-up privatisation process drove away all of the world’s tobacco majors with its requirements for tobacco purchases from local growers. Now “one of theirs” has closed down production.

For Peevski, operation ‘Bulgartabac’ was successful. By selling the brands and local distribution to British American Tobacco (BAT) for $109.41 million which has agreed to acquire Victory, Eva Slim and GD cigarette brands and Express Logistics and Distribution OOD from Bulgartabac Holding AD on 5 May 2017.

Bulgartabac Holding has reported a strong financial performance in 2022 and its consolidated net profit stood at $20.23 million, a marked improvement from the previous year’s net loss. The company recovered from the previous losses following its decision to sell its major cigarette brands to BAT and diversify its investments.