Bulgaria's Sofiyska Voda Sale to be Wrapped Up by Oct

The deal for the sale of several European water supply and treatment businesses from United Utilities, including Bulgaria's Sofijska Voda, to France's Veolia Environnement, is expected to be finalized by the beginning of October, it emerged on Wednesday.

“A preliminary contract has been signed, but the wrapping up of deal will be delayed since it includes also 26% of Tallinn-based AS Tallinna Vesi and a third of Aqua SA, which provides water for the Polish city of Bielsko Biala,” said Ivan Ivanov, executive director of Sofijska Voda.

The French utility will take a 58% stake in Sofiyska Voda, the company operating water supply and treatment services for the city of Sofia in Bulgaria, which serves 1.3 million inhabitants.

“The new owners will not change the investment program of the company, since it has to be approved by Sofia municipality and given the green light by the energy and water regulator,” he added.

The company plans to invest BGN 240 M by 2013, BGN 50 M of which come from a loan from the European Bank for Reconstruction and Development.

The concessioner invested last year BGN 52 M in an upgrade of no more than 1% of the sewage system.

According to Ivan Ivanov the capital needs to apply for European Union projects to finance the thorough upgrade of the system.

More than twenty years after the fall of the communist regime, Bulgaria’s water sector remains one of the least reformed systems in the country.

Except for Sofia municipal water supply, which has been granted on concession to a foreign investor, all other units in the sector are either owned by the state or the municipalities.

The company in Sofia however has been harshly criticized for shortage of investments in the upgrade and maintenance of the system.

An average 60% of water pumped in the pipes never reaches Sofia consumers, while in some regions losses account for up to 90 %.

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