DGKV, working with Baker McKenzie, London, has advised British American Tobacco on its over EUR 100 million acquisition of assets of Bulgarian cigarette maker Bulgartabac Holding, including Bulgartabac's Victory, Eva Slim, and GD tobacco brands and its distribution and retail assets in Bulgaria and Bosnia. The sellers -- Bulgartabac Holding AD and Blagoevgrad-BT AD -- were represented by in-house counsel on the deal.
Bulgartabac will continue to produce cigarettes through its subsidiaries Blagoevgrad-BT AD and Sofia Bulgartabac AD.
According to DGKV, the deal will help BAT almost triple its market share in Bulgaria, while creating over 1000 new jobs, making it one of the country's five largest taxpayers. DGKV quotes BAT Head of Markets Central Europe Cluster Richard Widmann as saying, "we are committed to the Bulgarian market and are excited about this significant investment in the country, which seems to have some bright future ahead."
DGKV reports that BAT, the second largest tobacco company in the world by market share, "was one of the most prominent candidates to privatize Bulgartabac earlier in 2005, but then the deal collapsed. The international company was also among the bidders for its privatization in 2011 when it withdrew its proposal based on commercial reasons."
DGKV's work on the project included "exhaustive due diligence exercise of the assets and the distribution business in Bulgaria, preparation of transaction documents and transactional work, as well as full support in the negotiations process." The firm’s M&A team was led by Partner Violetta Kunze, assisted by Partners Vessela Stancheva-Mincheva and Viara Todorova, Senior Associates Ralitsa Gougleva, Teodora Tsenova, and Kaloyan Krumov, and Associates Dimo Staykov, Ivan Punev, Rusalena Angelova, Vlada Tsenova, Vladislav Antonov, Nikola Minchev, Kamen Gogov, Tsvetelina Bayraktarova, and Galin Atanasoff.
Baker McKenzie’s team was led by Partner Timothy Gee and Associate Maria Boccardo.