By Andrei Skvarsky.
Russia’s VTB Capital has completed the acquisition of Bulgartabac, one of Europe’s leading cigarette manufacturers.
The investment banking arm of state-owned VTB Group, Russia’s second biggest lender, said in a statement it had paid 100.1m euros ($136.8m) for its 79.83% stake in the Sofia-based company.
The terms of the deal include commitments by Bulgartabac to yearly buy 5,000 tonnes of tobacco from Bulgarian farmers for the next five years and invest at least 7m leva ($4.9m) in its business development in the next two years.
VTB Capital’s head of investment, Alexander Romanov, has been put at the head of Bulgartabac’s new board.
“We plan to perform a thorough review of Bulgartabac’s management processes and operations,” said Atanas Bostandjiev, VTB Capital’s London-based head of UK and international operations.
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