2 Bidders DQd from Privatization of Troubled Bulgarian Military Plant

Business | November 5, 2012, Monday // 15:35|  views

Emko EOOD has been estimated as the only eligible candidate for the privatization of Bulgaria's largest military-industrial plant, VMZ Sopot. File photo

Two bidders have been disqualified from the tender for the privatization of Bulgaria's largest military-industrial plant, VMZ Sopot, leaving Emko EOOD as the only eligible candidate, according to the website of the Privatization and Post-Privatization Control Agency (PPCA).

The two other candidates who filed documents, Sofia-based Sage Consultants AD and Ruse-based Dunarit AD, do not meet the requirements of the privatization strategy for VMZ Sopot, according to the PPCA.

All three participants who purchased tender documents managed to submit them by the October 29 deadline for preliminary evaluation.

The PPCA asked Emko EOOD Sofia for clarification of the tender documents.

The disqualification of the two companies was expected because only Emko EOOD has the necessary turnover of at least BGN 120 M for the past three years.

The turnover of Dunarit AD slightly exceeds BGN 96 M, while Sage Consultants AD does not meet the requirement for being a producer, not a trader.

Emko EOOD, which was set up in 1992, is a manufacturer of small arms and ammunition with Emiliyan Gebrev as sole owner.

Emko EOOD made headlines in November 2011 after explosions in its former military ammunition warehouses near the village of Lovnidol, Sevlievo Municipality.

The document submission deadline for the privatization tender of the Sopot-based plant was moved from December 27 to October 29 due to its serious indebtedness.

According to data of Bulgaria's Ministry of Economy, Energy and Tourism, the debts of VMZ Sopot amount to over BGN 150 M, BGN 47 M of which it owes to the state.

Apart from that, the wages of the workers at VMZ Sopot have been delayed by a few months.

The privatization of VMZ Sopot is to be wrapped up by November 30.

The VMZ Sopot plant, located in central Bulgaria, has a total staff of 3 700 workers.

The plant was founded in 1936, and during the communist period was developed into a large-scale military industrial unit.

VMZ Sopot produces anti-tank guided and unguided missiles, aviation unguided missiles, artillery ammunition, fuses.

It also manufactures civilian products – it makes diamond tools, abrasive discs and grinding wheels, gas cylinders, food industry equipment, and household appliances.

VMZ Sopot has been in a troubled financial condition over the past few years.

In 2007, Bulgaria's Privatization Agency started selling VMZ Sopot assets in order to cover part of its debts; another portion of assets of the military plant was sold at the beginning of 2009.

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Tags: Privatization and post-Privatization Control Agency, privatization, VMZ Sopot, indebted, military plant, Emko, bidders


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