In connection with the speculations on the occasion of the held auction for the sale of the shares of "Road Construction Engineering" AD, BBR provided the following information:
On 17.06.2019, the Bulgarian Development Bank (BDB) concluded a loan agreement with “Rodway Construction” AD for financing the acquisition of 5,112,240 shares from the capital of “Road Engineering“ JSC from the majority owner and seller “Bio Mining“ AD. The collateral for the loan with the highest value is the stakes on the shares of “Road Engineering“ AD and on the commercial enterprise of the company.
In mid-2022, due to non-payment of obligations under the loan agreement, BBR took action under the Special Liens Act (PLA) against the commercial enterprise and appointed a manager of “Rodway Construction” JSC, as well as new management of “Road Construction“ AD, thereby making efforts to stabilize the company, which is the only asset and a possible source for repaying the loan.
After BBR's management found that the actions to collect the receivables under this exposure and protect the bank's interests were ineffective, it commissioned a detailed analysis and the preparation of an action plan. As a result, it was found that the sale of the company's shares is the only possible way to collect the debts of “Rodway Construction” Inc.
In 2024, the current management of BBR will take action to sell the shares in accordance with the Commercial Law, conducting five consecutive auctions with open bidding, guaranteeing full transparency of the procedure.
The announcement of the tender with an initial price of BGN 8,900,000, formed on the basis of an independent external assessment of the enterprise, proves the fact that the loan was practically unsecured and the bank could not collect a larger amount on it.< /p>
The first four tender procedures have been declared not to have been conducted due to the lack of submitted applications for participation. In the last auction held on 30.07.2024, an application was received from one participant - “Ariete Capital“ Ltd., announced as the buyer at a price of BGN 3,645,440.
Due to the initiated pre-trial proceedings, the bank has fulfilled its obligation and handed over the originals of the loan documents to the competent authorities, which is why the auction cannot be closed.
BBR sends signals to the judicial authorities in connection with the exposure, including in the order of the instance control, the bank submits a request to the Supreme Prosecutor's Office to cancel the rulings of the Appellate Prosecutor's Office – Sofia and Sofia City Prosecutor's Office.
As a result of BDB's actions, the materials from the pre-trial proceedings have been returned for the continuation of the investigation, and the bank continues to provide full assistance to the judicial authorities in the case.
Thanks to the consistent efforts of the current management of the BDB, full transparency of the institution has been ensured, effective control has been introduced and the possibility of credit abuse has been prevented.