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Sep 24, 2007 18:02 EEST
September 24 (SeeNews) - CBA Asset Management, which manages CBA supermarkets in three cities in northern Bulgaria, is considering entering neighbouring Romania aiming to benefit from the closer ties between the two countries after their EU entry, a company official said on Monday.
“We have researched possibilities for [entering] the neighbouring markets (…) Our subsidiary in Ruse is in a very good position regarding the Romanian market (…) but this step will be done later, in the mid-term at the minimum,” CBA supermarkets general manager for the northern towns of Veliko Tarnovo, Gabrovo and Ruse, Ivailo Marinov, told SeeNews.
The Danube city of Ruse, Bulgaria’s fifth largest, has gained great popularity among Romanian shoppers since January 1, when Bulgaria and Romania joined the European Union. Romanians, whose living standards have increased more rapidly than those of their neighbours, are strongly attracted by Ruse's low prices.
Marinov said the company, which plans to go public in November, will invest some 10 million levs ($7.2 million/5.1 million euro) in expanding its network in the country and buying rivals within two years. It plans to add some 3,000 square metres per year through buys and new openings to its existing 10,000 square metre network, he added.
CBA Asset Management has said it will seek to raise at least 7.8 million levs in an initial public offering (IPO) on the Sofia bourse. Marinov said the company might consider financing its expansion plans also through a future bond issue.
The company has said it expects its revenue to reach 150 million levs by the end of 2009, up from 45 million levs projected for 2007. CBA Asset Management had revenue of 20 million levs and consolidated profit of 467,000 levs at the end of June.
CBA, in which Hungarian CBA Commercial owns a minority stake, is a league of co-branded independently-owned stores. In Bulgaria, the chain includes some 170 stores and their number is planned to rise to 400 by the end of 2009.
(1 euro = 1.95583 Bulgarian levs)
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