Advent close to Bulgarian telecom deal

The Bulgarian government has named Advent International as preferred bidder for the state-owned telecommunications business.

International private equity firm Advent International has beaten competition from a Turkish telecoms consortium to be named as preferred bidder for the privatisation of the state-owned Bulgarian telecommunications business.

Through a Vienna-based holding company, Viva Ventures, Advent International has made a E200m offer for a 65 per cent stake in BTC, with the government retaining the remainder. A consortium comprising Turkish industrial group Koc Holding and Turk Telekom offered E185m for the stake.

The Advent consortium, which also includes Polish private equity house Enterprise Investors, is now arranging financing for the deal. The sale is conditional on Advent agreeing to commit around E450m over the next four years to upgrading the network, which provides telecoms services to 35 per cent of the Bulgarian population.

The offers came in below original government requirements, forcing the government to consider asking the two groups to improve their bids. The situation contrasts starkly with the situation in 2000, when the previous Bulgarian government rejected a bid of $610m from Greek telecoms firm OTE and Dutch KPN for a 51 per cent stake in BTC, including a GSM licence.

The deal is expected to close by the end of 2002.