Investor Update

 

TIDMTBI 
 
RNS Number : 0084N 
Trans Balkan Investments Ltd 
03 June 2010 
 

03 June 2010 
          TRANS BALKAN INVESTMENTS LIMITED 
 ("TBIL or the "Company") 
                                Investor Update 
 
TechnomarketDomo ("TMD") 
The Board is in discussion with the minority shareholders of TMD concerning an 
unsolicited and indicative offer from them to purchase TBIL's equity 
shareholding of 61.8 % in TMD.  Whilst the Board is giving suitable 
consideration to this offer, it is also reviewing other realistic options 
whereby it can resolve most advantageously for the Company's shareholders the 
matter of raising sufficient funds in the near future both to repay the EUR 17 
million TBIL owes to the State General Reserve Fund of Oman ("SGRF") as well as 
to finance the further development of the TMD Group's business throughout the 
South East European region.  To this end, the Board is in the process of 
selecting a suitable independent financial adviser to assist it in this 
endeavour. 
This review of the options in respect to TMD is taking place as the Company 
continues to face a challenging trading environment.  Both the businesses in 
Romania and Bulgaria have increased their market share while taking steps to 
reduce costs, close unprofitable stores and otherwise refine operating 
efficiencies. 
Further to the announcement made on 9 February 2010 regarding SGRF having 
notified the Company that their exchange rights and other rights under a 
comprehensive security package had become exercisable and as such SGRF had 
reserved its position, TBIL continues to work towards a resolution of the 
issues. 
Borovets 
No early decision is likely to be made in the light of the continuing weak 
market conditions in respect to this potential resort development.  However, 
there have been some preliminary discussions with the representatives of a major 
resort developer which are ongoing. 
Novera 
As previously announced, TBIL has had a meeting with legal representatives of 
the Bulgarian Government, over the Municipal Council of Sofia's conduct in 
relation to the termination of the  Concession Agreements.  The senior and 
mezzanine lenders to Novera also participated in this meeting.  The initial 
response from the Bulgarian Government to these discussions is to reject any 
proposal for a negotiated settlement.  Consequently, the Board is investigating 
the options available to it in respect to pursuing the complaint with the 
Bulgarian Government, under the terms of the relevant Bilateral Investment 
Treaty. 
Property Companies 
Pelican, one of TBIL's wholly owned property subsidiaries, is in discussions 
with potential buyers for the sale of its three former cinemas sites (namely 
Iztok, Urvich and Europa Palace), all situated in Sofia.  In the case of the 
Iztok cinema a preliminary purchase agreement has already been signed and, 
subject to its conditions being met, completion of the transaction, at a 
purchase price of EUR 1.8 million, is anticipated to occur in late June 2010. 
TBIL, with the benefit of advice from an independent property consultant, has 
determined the most realistic and advantageous course for handling the balance 
of its properties held through its subsidiaries Pelican and Immofinance.  In 
respect to the Banya Hotel and Spa project, the Company is in advanced 
discussions with DSK Bank concerning a proposal for completing the project. 
Regrettably, the Sozopolis Resort project has yet to identify a satisfactory 
solution and the Company is still in discussion with Alpha Bank concerning its 
future. 
Cash Flow Update 
TBIL's liquidity has been boosted in recent months firstly by the repayment of a 
loan provided to Uniqa AD which, together with outstanding interest, amounted to 
EUR 3,691,673, and secondly by the settlement, and initial payments, of an 
agreed repayment schedule over the coming 12 months for the balance of the Auto 
Union sale proceeds, amounting in all to EUR 2 million. 
Restructuring 
The Board can report that the planned simplification and consequent reduction in 
cost of the TBIL group's corporate structure is progressing well.  The number of 
companies within the group has been reduced from 43 to 28 by way of merging or 
liquidating defunct entities.  The number of entities is expected to be reduced 
by a further 8 by the end of the year. 
TBIL is currently reviewing its contracts with external service providers in 
order to ensure that the most competitive service and fees are obtained. 
Audit 
The audit in respect to the financial year ended 31 December 2009 is still in 
progress and it is hoped that Deloitte Audit OOD, the Company's new auditor, 
will complete this over the coming month. 
Enquiries: 
 
+------------------------------------------+-------------------+-------------------+ 
| Trans Balkan Investments Limited         | Ian Schmiegelow   | Tel: + 44 20 7630 | 
|                                          | (Chairman)        |              3350 | 
|                                          | Natalie Weedon    |                   | 
+------------------------------------------+-------------------+-------------------+ 
|                                          |                   |                   | 
| Financial Dynamics                       | Ed Gascoigne-Pees | Tel: + 44 20 7269 | 
|                                          | Nick Henderson    |              7132 | 
|                                          |                   |                   | 
+------------------------------------------+-------------------+-------------------+ 
|                                          |                   |                   | 
| Collins Stewart Europe Limited           | Stewart Wallace   |          Tel: +44 | 
| (Nomad)                                  |                   |      20 7523 8350 | 
|                                          |                   |                   | 
+------------------------------------------+-------------------+-------------------+ 
| KBC Peel Hunt Limited                    | Capel Irwin       | Tel: + 44 20 7418 | 
| (Broker)                                 |                   |              8900 | 
+------------------------------------------+-------------------+-------------------+ 
 
                                     -ENDS- 
 
 
This information is provided by RNS 
            The company news service from the London Stock Exchange 
   END 
 
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