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Bulgarian businessman gets majority stake in gas distribution JV with Gazprom - report

Bulgarian businessman gets majority stake in gas distribution JV with Gazprom - report Denys Prykhodov/

SOFIA (Bulgaria), July 4 (SeeNews) - Bulgarian businessman Sasho Donchev has become the majority owner of Sofia-based gas distribution company Overgas Mrezhi, a joint venture with Russian gas giant Gazprom, through a capital hike of about 200 million levs ($113.8 million/102.4 million euro), local media reported on Monday.

Prior to the capital hike, Gazprom and the Bulgarian investor held equal stakes in Overgas Inc, which in turn owned 99.6% of Overgas Mrezhi's capital, Capital Daily reported.

Overgas Mrezhi officials declined comment for SeeNews.

A general meeting of Overgas Mrezhi in early April voted in favour of an increase of the company's capital by 202.5 million levs to 330 million levs, following which London-based DDI Holding's stake in the company stood at 61.38%. DDI Holding is owned by DD Management in which Donchev holds 55%.

DDI Holding, managed by Donchev, has already paid 25% of the nominal value of the capital increase amounting to 50.6 million levs, as the rest of the capital should be injected within two years, the daily added.

In June Overgas Mrezhi borrowed 160 milion levs from local lender UniCredit Bulbank.

A small portion of the funds will go to refinance loans and the remainder will cover debts to Overgas Inc., Capital reported.

On December 31, Gazprom Export, a fully-owned subsidiary of Russia's state-owned gas group Gazprom, notified Overgas that it would discontinue gas supplies to the company on the following day and that it had taken steps to satisfy Overgas clients' gas needs via supplies to Bulgargaz, the Bulgarian state-owned gas monopoly. Overgas then said it has no outstanding liabilities to the Russian company.

In January, Overgas said it will pay nearly 17 million levs ($9.3 million/8.7 million euro) for gas supplied by Bulgargaz following the halt in deliveries by Gazprom. In April Overgas Inc. filed an arbitration claim against Gazprom Export due to the halt in deliveries at the end of last year.

Bulgaria is almost entirely dependent on Russian gas to meet its domestic needs, as the bulk reaches domestic gas consumers via Bulgargaz.

Overgas Inc supplies gas to over 55,000 households and 3,000 industrial users, according to data published on its website.

(1 euro = 1.95583 levs)