Bulgaria PM Girlfriend Gains Control in Bulgarian-American Credit Bank

Tsvetelina Borislavova (left) is pictured here at an award ceremony for the most influential Bulgarian women with Sofia Mayor Fandakova (middle) and EU Commissioner Kristalina Georgieva (right). Photo by BGNES

An investment firm led by Tsvetelina Borislavova has acquired a majority stake in Bulgarian-American Credit Bank (BACB) following the public offering of its shares.

The businesswoman's Clever Synergies Investment Fund (CSIF) now owns 56.3% in the bank, a check in the trade registry shows.

Borislavova, known also as the girlfriend of the Balkan country's prime minister, Boyko Borisov, has subscribed 7.6 million shares tagged at BGN 30.43 M.

The issue price of the subscribed new shares has been paid in full and the sum credited to the escrow account of BACB  with the depository bank, Unicredit Bulbank AD, amounts to BGN 48,26 M.

The public offering of shares was undertaken in accordance with the terms and conditions of the resolution of BACB's general meeting of shareholders held on July 5.

Bulgaria's central bank gave the green light for the sale of 49.9% stake in the Bulgarian-American Credit Bank by Allied Irish Banks to Bulgarian private equity fund CSIF in the middle of June.

The price of the deal was EUR 100,000. CSIF also have to pay back a loan worth EUR 25 M.

Allied Irish Banks announced a month earlier that it has signed an agreement to sell its 49.99% shareholding in Bulgarian-American Credit Bank AD to Clever Synergies Investment Fund (CSIF).

The deal brought back into the banking sector Bulgarian tycoon Tsvetelina Borislavova, more publicly known as the woman with whom Prime Minister Boyko Borisov formerly lived out of wedlock. The sizable purchased was acquired through her company Clever Synergies Investment Fund (CSIF).

BACB is a publicly listed bank based in Sofia, Bulgaria, focused on small to medium sized enterprises. As at 31 December 2010, BACB reported consolidated total assets of EUR 375.9 M and shareholders' equity of EUR 96.6 M.

CSIF is a private investment company founded in 2005; its shareholders are Tsvetelina Borislavova and her foundation Credo Bonum.

In December 2010, Tsvetelina Borislavova, believed to be one of the richest Bulgarians, and described in various rankings as one of the most powerful Bulgarian women, formally left the banking sector as the Belgian banking group KBC acquired full control over its subsidiary in Bulgaria CIBank.

Back then the prime minister's long-time live-in girlfriend Tsvetelina Borislavova sold her last 16% stake. The price of the deal exceeds BGN 141 M or BGN 110.49 per share.

KBC agreed to buy 75% in the bank, initially called EIBank, for EUR 295 M in September 2007 and secured the approval of both the central bank and competition authorities at the end of the year.

The group bought half the stake of board chairwoman Tsvetelina Borislavova and the full stake held by Novator investment fund, which manages the Bulgarian assets of Icelandic mogul Thor Bjorgolfsson.

That was the second major acquisition by the Belgian group in Bulgaria, having agreed earlier that year to buy 70% in insurer DZI, later boosting its stake to 85%.

Initially, Borislavova kept 22.3% of her shares and became "KBC's partner", keeping her position as chair of the supervisory board.

Subsequently KBC launched a buyout offer to the minority shareholders in the bank and gradually increased its capital.

Bulgaria's Economic and Investment Bank (EIBank) changed its name to CIBank in October 2008 without giving reasons for its decision.

The name of the Bulgarian-American Credit Bank recently was in the center of scandalous allegations after German investigative journalist Jurgen Roth alleged that BNB Governor Ivan Iskrov put pressure on the Irish bank, Allied Irish Bank (AIB), owner of the Bulgarian-American Credit Bank (BACB) in Sofia, to sell a 50% stake to Central Cooperative Bank at the price of BGN 1, the equivalent of EUR 0.5. Subsequently, Roth renounced his accusations.

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