In response to numerous media inquiries, I would like to inform you , that on 17.06.2019 “Bulgarian Development Bank“ granted a loan to “Rodway Construction” AD for the sum of BGN 148,500,000 for the acquisition of 5,112,240 shares from the capital of “Road Construction“ AD.
Due to non-payment of obligations under the loan agreement concluded with “Rodway Construction” AD, in 2022 “Bulgarian Development Bank“ EAD took enforcement action under the Law on Special Bets on the commercial enterprise of “Rodway Construction” AD, as the manager of “Rodway Construction“ AD and new management of “Road Construction“ AD. The aim was to assess the financial condition of the companies, the contracts concluded with counterparties and their performance and their ability to generate sufficient revenue to service their obligations.
This commented on "Facebook" the executive director of BBR Tsanko Arabadzhiev.
In the last two years, efforts were made to financially stabilize “Road Engineering“ JSC and increasing the possibilities for realizing sufficient funds from the activity in order to repay the largest possible part of the debt to the Bank. The assessment of the financial situation of the two indebted companies and the actions taken showed that they could not generate sufficient income to pay off their obligations, which led to the need to realize separate assets in order to reduce the exposure.
„Road construction engineering“ AD is the only asset and possible source for repayment of the credit exposure of “Rodway Construction” AD. The performed analysis of the financial status of “Road Construction“ AD and the collateral under the loan agreement showed that the sale of its shares is the only way to collect at least part of the obligations of “Rodway Construction” Inc.
In order to avoid a further increase in the obligations under the loan agreement and to minimize the losses for the bank, actions were taken to sell the shares of “Road Engineering“ AD according to the Commercial Law.
„Bulgarian Development Bank“ EAD held a total of five auctions with open bidding for the sale of 5,112,240 available registered shares from the capital of “Road Construction“ AD, owned by “Rodway Construction” JSC pledged in favor of BBR.
1. First auction, scheduled for 11.06.2024, with an announced starting price for the sale of the shares BGN 8,900,000. Due to the lack of applications for participation received on 11.06.2024, the tender was declared not to have been held.
2. Second auction, scheduled for 24.06.2024, with an announced starting price for the sale of the shares BGN 7,120,000. Due to the lack of received applications for participation on 24.06.2024, the tender was declared not to have been held.
3. Third auction, scheduled for 07/05/2024, with an announced starting price for the sale of the shares BGN 5,696,000. Due to the lack of received applications for participation on 05.07.2024, the tender was declared not to have been held. 4. Fourth auction, scheduled for 17.07.2024, with the announced starting price for the sale of the shares BGN 4,556,800. Due to the lack of applications for participation received on 15.07.2024, the auction was declared not to have been held.Fifth auction, scheduled for 30.07.2024, at the announced starting price for the sale of the shares BGN 3,645,440. Tender documentation for the tender was purchased from two companies until 29.07.2024. The bank received only one application for participation in the auction from "Ariete Capital". Ltd. On 30.07.2024 “Ariete Capital“ Ltd. has been announced as the winner of the tender.
Bulgarian Development Bank is fully cooperating with the investigation.