Bulgarian Tycoon Denies Control over Moststroy after Insolvency News

Bulgarian billionaire Vassil Bozhkov has denied reports that he controls Moststroy AD, a construction company, which filed for bankruptcy on Thursday after all its bank accounts were frozen because of unpaid debts.

"Vassil Krumov Bozhkov holds a 21,07% stake in Moststroy AD, which does not allow him to control the activities of the company single-handedly," says a statement, circulated to the media, by Nove Holding, whose president Bozhkov is.

"This is the reason why we express our surprise at media reports, according to which Moststroy AD is owned by Mr. Vassil Bozhkov," the statement adds.

Nove Holding AD, controlled by Mr. Bozhkov, is member of the Board of Directors of Moststroy AD, but does not represent it, it says.

The statement stresses that "what happens with Moststroy AD will in no way have an impact on the business of Mr Bozhkov or his projects in the country and abroad".

Moststroy AD shed 88% of its market value as around 450,000 shares were traded on Thursday after the company announced that it has filed for bankruptcy as all its bank accounts were frozen because of unpaid debts.

A loan borrowed from the United Bulgarian Bank, a unit of the National Bank of Greece SA, was due on May 31, but the company said it has no money. Its construction machines and other equipment have been seized by Interlease, the company that leased them.

According to analysts the file for insolvency of Moststroy AD is very bad news for the Bulgarian capital market, but comes as no surprise. The precedent is feared to further dent the trust of the investors, particularly those from abroad, and make it more difficult to get credits from banks.

Under local legislation a company, which has declared insolvency, can restructure and draw up a rehabilitation plan.

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