Category: Bulgaria

Georgiev, Todorov & Co has successfully represented Uni Hospital in a claim against the National Health Insurance Fund for payment of over-the-limit medical activities.

According to Georgiev, Todorov & Co, the “Uni Hospital General Medical Treatment Facility is one of the largest private investments in Bulgarian healthcare for the past 25 years. The hospital is located in Panagyurishte and offers precision by established specialists, unique medical care, and state-of-the-art medical equipment.” According to the firm, the case concerned the “payment for hospital care services provided on clinical paths to health-insured persons above the limits set by the NHIF for the period between February 1, 2017, and September 30, 2018, for an overall amount of over BGN 2 million including statutory interest.”

The Sofia City Court first decided in favor of Uni Hospital in 2020, and the Appellate Court confirmed this decision in July of 2021. According to Georgiev, Todorov & Co, “therefore, the court ordered the NHIF to pay the healthcare establishment the due remuneration for hospital medical care provided on clinical paths, medical, and ambulatory procedures over the monetary limit set for the period above, along with the statutory interest until the final payment of the amount. The hospital will be able to claim all other expenses related to the claim.”

Georgiev, Todorov & Co’s team included Lawyers Maria Derelieva and Margarita Ivanova.

Kinstellar has advised Netherlands-based industrial developer CTP on two real estate acquisitions in Bulgaria. 

According to Kinstellar, “through an innovative sale-and-lease-back structure, CTP has successfully finalized the acquisition of a production facility operated by Willie Elbe, a leading automotive tier-1 supplier of highly sophisticated automotive parts. The deal allows CTP to strengthen its portfolio of industrial development projects and long-term leasing services to blue-chip tenants.”

According to the firm, “CTP has also acquired strategically positioned land plots with a total area exceeding 50,000 square meters for the construction of a logistics park near Sofia, which further reinforces its position as a major logistics park developer in Bulgaria.”

Kinstellar’s team included Partner Antonia Mavrova, Managing Associate Atanas Mihaylov, Senior Associate Emil Lukaev, and Associate Simeon Vachev.

Kinstellar did not reply to our inquiry on the matter.

CMS has successfully represented Global Biomet in proceedings against the Ministry of Finance of the Republic of Bulgaria in a dispute related to the country’s feed-in tariff.

According to CMS, between January and August 2014, “the Bulgarian state budget collected 20% fees from the income of all solar and wind producers in the country prior to these provisions of the Renewable Energy Act (2011) being declared unconstitutional by the Bulgarian Constitutional Court. Regardless of Ruling 13 under Constitutional Court case No 1/2014, the Bulgarian state refrained from paying back to the renewable energy investors the fees, which were collected under the unconstitutional provisions, which were repealed by the Bulgarian Constitutional Court.” According to the firm, “instead of a settlement, which was offered by the investors, the Bulgarian Ministry of Finance decided to litigate all renewable energy producers for a period of 7 years.”

According to CMS, the Bulgarian Ministry of Finance decided to skip the third instance appeal process and has practically surrendered its position.

CMS’s team was led by Sofia-based Managing Partner Kostadin Sirleshtov and Partner Assen Georgiev and included Senior Associate Borislava Piperkova, Associates Elena Yotova – Yordanova and Yana Antonova, and Trainee Teodora Peycheva.

Schoenherr has advised MET Group on the acquisition of a 60-megawatt operational wind park in Suvorovo, Western Bulgaria, from Grupo Enhol. 

Тhe transaction is expected to be closed by Q3 2021.

According to Schoenherr, the “Suvorovo Wind Park, representing 8.5 % of the total installed wind capacity in Bulgaria, consists of 30 units of Gamesa G90 wind turbines – 2-megawatt capacity each. The wind farm, operating since 2012, produces approximately 120 gigawatt-hours of electricity per year, supplying power equivalent to the consumption of around 38,000 households.”

MET Group is a Swiss-based European energy company with activities in the natural gas and power markets, focused on multi-commodity wholesale, trading and sales, energy infrastructure, and industrial assets.

Grupo Enhol is a Spanish family-owned company focusing on renewable energy.

Schoenherr’s team included Partners Alexandra Doytchinova and Stefana Tsekova, Attorneys Katerina Kaloyanova-Toshkova, Dimitar Vlaevsky, Elena Todorova, and Galina Petkova, and Associates Milena Gabrovska, Dimitar Kairakov, and Gergana Roussinova.

Schoenherr could not provide additional information on the deal.

Kinstellar Sofia has advised American online resale platform ThredUp on its USD 28.5 million acquisition of European fashion resale company Remix Global.

According to Kinstellar, “U.S. based thredUp jumpstarts its expansion in Europe, adding a complementary operational infrastructure and an experienced management team.” The price is subject to customary purchase price adjustments and the deal is expected to close during the fourth quarter of 2021.

Kinstellar’s team consisted of Counsel Nina Tsifudina, Senior Associates Zornitsa Georgieva, Emil Lukaev, and Georgi Kanev, and Associates Nikolay Gergov, Debora Dineva, and Ilia Lassin.

The firm was unable to disclose further information about the deal.

Editorial Note: After this article was published, Gugushev & Partners announced it advised the Remix Global majority shareholders on the deal. The firm’s team consisted of Managing Partner Stefan Gugushev, Senior Partner Dimitrinka Metodieva, and Head of Corporate and Tax Department Daniela Petkova.

On October 20, 2021, Penkov, Markov and Partners announced the transaction had successfully closed. The firm advised Dutch entities AMC III Clothing and Accession Mezzanine Capital III Cooperatief on the sale of their participation in Remix. The PM&P team included Senior Partner Vladimir Penkov, Managing Partner Nikolay Cvetanov, and Associates Pavel Tsanov, Rumyana Yordanova, and Vencislav Semkov.

Boyanov & Co, working with the London office of White & Case, has advised the initially mandated lead arranger, the general security agent, the Bulgarian security agent on EUR 360 million facilities to Eastern European Electric Company B.V. Djingov, Gouginski, Kyutchukov & Velichkov advised the agent and lender Metric Capital Partners on a mezzanine facility provided to the company.

The financing was intended for the acquisition of a group of seven targets in Bulgaria, including the electricity distribution utility companies in North-West Bulgaria from CEZ. The initially mandated lead arranger was J.P. Morgan AG, the general security agent was BNY Mellon Corporate Trustee Services Limited, and the Bulgarian security agent was DSK Bank AD.

The Eastern European Electric Company is an indirect subsidiary of Eurohold Bulgaria.

Earlier this year, CEZ obtained authorization from the Bulgarian Energy and Water Regulatory Commission for its disposal of 67% of its shares in CEZ Distribution Bulgaria to Eastern European Electric Company (as reported by CEE Legal Matters on January 28, 2021).

Boyanov & Co’s team included Partners Damian Simeonov and Alexander Chatalbashev and Senior Associate Ralitsa Nedkova.

Djingov, Gouginski, Kyutchukov & Velichkov’s team included Partner Georgi Tzvetkov, Senior Associate Gergana Monovska, and Associate Lora Alexandrova.

Editor’s note: After this article was published, Stoeva Tchompalov & Znepolski informed CEE Legal Matters that it had advised Eurohold, working with Morrison & Foerster in London. The STZ team was co-led by Partners Iordan Tchompalov and Irina Stoeva and included Of Counsels Vania Todorova and Yasen Nikolov, Senior Associate Miroslava Iordanova, and Associate Tihomir Todorov.

Subsequently, CMS announced it had advised the EBRD on amending and extending its facility for CEZ Distribution in the context of the acquisition. The CMS Sofia team included Partner Elitsa Ivanova and Associate Katerina Hristova.

CMS has advised UniCredit Bulbank on the refinancing of Solarian Holdings’ 21-megawatt operational photovoltaic portfolio in Bulgaria.

According to CMS, the EUR 36 million refinancing project relates to a number of special-purpose companies, including Consult Solar EOOD, Solar R1 EOOD, Solar RAS EOOD, Green Energy Park EOOD, and Vento Eco Energy EOOD, all operating under the contracts-for-premium scheme, introduced by Bulgaria in order to replace the feed-in tariff under the Second Renewable Energy Act.

Last year, CMS had advised Solarian Holdings on the acquisition of a 5-megawatt photovoltaic power plant from FEC Perun (as reported by CEE Legal Matters on May 28, 2020) and the acquisition of a 2.25-megawatt photovoltaic power plant from Julian Torchanov and Mat Ltd. (as reported by CEE Legal Matter on August 21, 2020), both located in Bulgaria.

CMS’s team included Partners Dimitar Zwiatkov, Kostadin Sirleshtov, and Gentscho Pavlov, Senior Associates Borislava Piperkova and Ivan Gergov, and Associates Diyan Georgiev, Tsocho Boshnakov, and Lyubomira Tanchovska.

With the country being steered by a caretaker government appointed by President Rumen Radev, the overall outlook for Bulgaria seems to be positive, according to Gugushev & Partners Partner Victor Gugushev.

“Indeed, the country does find itself in very interesting times,” Gugushev starts. “Following a decade of Bulgaria being run solely by one political party, things are changing.” He says that now, for the first time in over ten years, new political players are emerging while the country is being run by a caretaker government.

“The president did a wise thing by appointing a caretaker government – I’d say that the Council of Ministers has done great things, both for the Bulgarian economy and businesses and Bulgarian society in the past few months,” Gugushev says. The caretaker government seems to be enjoying strong citizen support as well, with Gugushev claiming approval ratings to be at an “unprecedented 60%.”

On the other hand, Parliament has no majority. According to Gugushev, even if the three new parties in parliament – the “parties of change” – came together, they wouldn’t have the necessary majority. “This is preventing either one of these three parties from proposing a new Council of Ministers without a consensus with others,” Gugushev says. 

Gugushev underlines several improvements brought forth by the caretaker government. “Firstly, a revision of public spending has been made, with big, state-owned companies being audited, the audit results being made public, and new rules being applied as to how public money is to be directed,” he says. Secondly, he reports that the Ministry of Economy has changed the supervising body of the Bulgarian Development Bank. This new body has adopted rules towards both increased transparency of its operations as well as increased access to funds for business, which, as Gugushev puts it, are “crucial for the SME sector.” Thirdly, Gugushev reports that the authorities have been more open towards businesses and started employing more transparent policies, which was “noticed by international investors which started flocking in, especially in the automotive, IT, and renewables sectors. Ministers Kiril Petkov and Assen Vassilev have done a great job so far. I imagine they would continue to make a great team in a regular government as well.” Lastly, he says that a new National Recovery and Resilience Plan has been drafted. “All EU member state governments are expected to submit a proposal of one such plan for the post-COVID-19 period,” Gugushev says. “The caretaker government spent a lot of time drafting it and it seems, upon an initial read, that it will be a good one.”

Finally, Gugushev says that this new path that the country is on might not last for too long. “The caretaker government will not be in place indefinitely. Whoever comes in might have their own agenda which might skew some or all of the work that was put in so far,” he says. However, Gugushev is hopeful that the “good work and good people” from the caretaker government will spill over into the next government as well. “I believe that, in the short term, Bulgaria will be very, very stable, but it is difficult to predict the long term, especially with the upcoming Presidential elections we have slotted for this October,” he says. “Still, the Bulgarian people have a certain degree of hope, something which was not present in abundance in recent years, and that itself is a wonderful thing.”

Boyanov & Co, working alongside Mayer Brown, has advised Hungarian OTP Bank Plc and its Bulgarian subsidiary DSK Bank AD on a EUR 27.6 million club deal financing to MET Renewables AG for the acquisition of a 42-megawatt wind park in Northeast Bulgaria from Enel.

According to Boyanov & Co, “MET Group is an integrated European energy company, headquartered in Switzerland, with activities in natural gas and power, focused on multi-commodity wholesale, trading, and sales, as well as energy infrastructure and industrial assets.

Boyanov & Co’s team included Partner Damian Simeonov and Senior Associate Ralitsa Nedkova.

Boyanov & Co has assisted Econt Financial Services in acquiring an e-money institution license from the Governing Council of the Bulgarian National Bank.

According to Boyanov & Co, “the company will provide innovative e-money payment services and solutions and will enable its customers to open electronic money accounts.” Econt Financial Services is wholly owned by Nikolay Sabev, owner of the logistics and courier service company Econt Express.

Boyanov & Co’s team included Partner Nikolay Zisov, Counsel Svetlina Kortenska, and Junior Associate Atanas Grigorov.