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Home News Tobacco workers protest ‘shady’ Bulgartabac sale

Tobacco workers protest ‘shady’ Bulgartabac sale

Published on 02/09/2011

Bulgarian tobacco workers on Friday protested against the approved takeover of state cigarette maker Bulgartabac by a Russia-backed company in what they have condemned as a "shady deal."

About 500 workers booed the headquarters of the privatisation agency, which this week gave the green light to the sale of Bulgartabac to BT Invest GmbH.

BT Invest is an Austria-registered company majority-owned by an offshore unit of Russia’s VTB Bank.

Protesters shouted “Mafia!” and carried slogans addressed to Prime Minister Boyko Borisov stating: “Mr Borisov, the Bulgartabac sale stinks. Stop this shady deal.”

“We want to ask the privatisation agency: ‘Who is the REAL winner of the tender?’” tobacco trade union chief Nikola Milenkov addressed the crowd of protestors.

BT Invest was the sole bidder in the tender after several other potential investors withdrew, sparking calls for the government to call off the sale.

But the privatisation agency accepted BT Invest’s offer of 100.1 million euros ($144.5 million) for 79.83 percent of Bulgartabac.

The deal now awaits approval from the agency’s supervisory board, with Economy and Energy Minister Traicho Traikov saying he would “closely monitor the procedure.”

Dnevnik economic daily however on Friday suggested that VTB Bank was only a go-between in the deal, working for a “buyer whose identity remains a mystery.”

“The government either does not know who the buyer of Bulgartabac is, or is afraid to tell,” Dnevnik wrote.

The question marks grew even bigger when a Sofia court said the Russian government, which controls VTB Bank, had applied for guarantees that might have blocked the sale.

The court said it refused to consider the application but did not provide details.

Moscow has claimed partial ownership of Bulgartabac from the time it took over German property in Bulgaria after World War II.