BTC takeover delayed

23 Jul 2007

The takeover of Bulgarian Telecommunication Company (BTC), the country’s dominant fixedline operator, has been delayed to allow further examination of the company’s market position. The European Commission said it would postpone a ruling on the acquisition of BTC by AIG Global Investment Group. The deadline for the decision on whether the acquisition can go ahead will now be made by the end of July after the Bulgarian Commission for the Protection of Competition (CPC) requested the postponement. The European Commission is set to rule on whether AIG’s takeover contravenes competition law.

Just last week, BTC was fined BGL200,000 (USD141,000) by the CPC for abuse of its dominant market position, in particular with regards to the company’s delay in giving access to its network to ISP NetPlus. NetPlus applied for access to the network in June 2003 and had to wait over a year until it was granted by BTC, which the CPC ruled was restricting consumers’ choice of ISPs. BTC has 14 days to appeal against the fine.

In May, AIG proposed a bid of EUR1.08 billion for the 65% stake of BTC held by Novator, an investment company affiliated to Icelandic tycoon Thor Bjorgolfsson. AIG Capital will also purchase a further 25% on the Bulgarian Stock Exchange, where the company is listed. AIG agreed to pay EUR1.66 billion for the total 90% stake and is reported to be planning a buy-out offer to the minority stakeholders and take the company private, once the CPC gives green light to the deal.

Bulgaria, Vivacom (BTC)