Holding Patishta (

) is planning a split, the company announced at a press conference. The split will happen next year, and according to the management it is very likely to happen at the beginning of the year.

According to Ognyan Hajiyanov, chairman of the Board of Directors, the major shareholders are not considering selling their stakes, and there have been no such talks. In order to avoid any speculations around the ownership, the company will announce the structure of the holding in a month and a half. After that Holding Patishta will host a press conference. This will all happen before the split.

At today's press conference, Holding Patishta announced its plans to acquire Shtrabag Bulgaria (Engstroy). The name of the buying company, a unit of Nove Holding, is still not clear.

The procedures of acquiring another two road-construction companies have almost been completed. The buyer is Holding Patishta, and the two companies are “not small”.

“The market needs to be consolidated, there are 100-150 players at the moment,” Mr. Hajiyanov explained.

Meanwhile, according to plans of Nove Holding, by 2008-2009 companies related to it will be implementing projects worth some 1 bln leva annually. These projects will most probably be Holding Patishta's projects. Currently, the holding has 2,500 shareholders, and Moststroy has around 400-500, Ognyan Hajiyanov also said.

Nove Holding will list its railway companies on the stock exchange next year, among which the crosstie plant in Svishtov, the locomotive and wagon plant in Russe, as well as The Railway Transport Institute in Sofia, and Transimpex BDZ. It is still not clear, whether the companies will merge before listing.

Asked about whether the major shareholder will continue selling shares, Hajiyankov said that it has so far sold just 0.28% of the capital, which is an unimportant amount, and that “even if 2% are sold, that be 8 mln leva, which is quite a small amount compared with the company's daily expenditures of about 4.5 mln leva.” He confirmed that there is such a possibility.

“The aim of selling is to increase our liquidity on the stock exchange, so that after the split the company will be able to enter the calculation of SOFIX and of the other indices. The companies included in SOFIX at the moment are very small and we think Holding Patishta should be one of them. The main problem with the holding is that its price per share is high,” Mr. Hajiyankov said.
Holding Patishta has invested 43 mln euros year-to-date, and the total amount investmed by the group amounts to 53 mln euros. According to Hajiyankov, Holding Patishta will post profit in the amount of 30-40 mln leva per year by 2008-2009. The company aims at achieving a 30% market share by 2008-2009.

“All investors holding stock in Holding Patishta, have only to wait for a couple of years more, and they will make a lot of money,” the chairman of the Board of Directors also said.

He also pointed out that no foreign company has won a project in Bulgaria over the past 1.5-2 years, which proves the quality of the work Bulgarian companies do.

In his words, Patni Stroeji AD has controlling stakes in companies holding stock in Holding Patishta, but it does not possess a majority stake in it. He also said that the value of the Patni Stroeji deal stood at 28 mln leva.

After Holding Patishta was acquired by companies related to Nove Holding, revenues have been increasing rapidly. In 2006 revenues stood at 94 mln leva (48.061 mln euros), up from 72 mln leva (36.813 mln euros) in 2005. Audited revenues (not taking into account deals within the holding) stood at 139 mln leva (71.070 mln euros) in 2006.

Pre-tax profit grew almost 10%, from 2.4 mln leva (1.27 mln euros) in 2005, to 9.4 mln leva (4.806 mln euros) in 2006.

“We invest in the company in such a way as to ensure a 15-15.5% profitability in 2008. We expect our pre-tax profit to reach 30-40 mln leva (15.33 – 20.45 mln euros) in the years after 2009,” Mr. Hajiyankov also said.

The company's stock was traded at prices between 23,555 to 25,000 leva/share yesterday.