VTB Capital Plc, the investment banking unit of Russia’s second-biggest state-run lender, plans to invest “several hundred million euros” in the Balkans in the next few years, the bank’s chief executive said.
VTB Capital opened an office in the Bulgarian capital Sofia today to help expand in southeast Europe as western investors pull cash from the region because of the debt crisis at home. Moscow-based VTB Capital has units in London, Hong Kong, Singapore, Dubai, New York, Vienna and Kiev.
“I’ll be happy if we invest several hundred million euros in the next few years in various projects in Bulgaria, Romania, Serbia and Greece directly as a bank or supporting our clients,” VTB Capital Chief Executive Officer Atanas Bostandjiev said in an interview in Sofia . “There are good opportunities in the energy, transport, telecommunications and agriculture industries everywhere in the region.”
Balkan countries including Serbia and Romania are struggling to narrow budget gaps and raise funds through state-asset sales to meet commitments under international bailout agreements. Western investors are cautious to invest in the region, on concern the Greek debt crisis will further hinder economic growth.
“We’ll be looking at privatization deals planned in Bulgaria, Serbia and Romania,” Bostandjiev said. “We are interested in the planned sale of the Romanian railways freight unit. Serbia is planning bank sales, which are of interest. Similar deals in Slovenia and Croatia are also of interest.”
‘Looking at’ Vivacom
VTB Capital bought an 80 percent stake in Bulgartabak, Bulgaria’s biggest tobacco company, for 100 million euros ($133 million), through its Austrian-registered unit BT Invest GmbH six months ago. The government also plans sell stakes in state utilities including the Bulgarian Energy Holding EAD to raise cash to meet foreign debt payments in January 2013 of some 800 million euros.
VTB Capital “is looking at” the acquisition of Vivacom AD, Bulgaria’s biggest fixed-line phone company, “in partnership with” the Sofia-based Corporate Commercial Bank AD, Bostandjiev said.
“It is a very complex transaction and it is too early to say anything more specific,” Bostandjiev said.
Bulgaria weathered the global crisis without an international bailout. The European Union’s poorest nation in terms of per-capita economic output wants to narrow this year’s budget deficit to 1.35 percent of gross domestic product to contain the effect of the euro area’s sovereign-debt crisis.
VTB Capital AD, the Bulgarian unit, will provide investment banking services, including advice on debt and equity transactions and on mergers and acquisitions, Bostandjiev said.
Former Bulgarian Finance Minister Milen Velchev was named chief executive officer and the lender expects the new office to grow to about 20 staff members.