Local company Kings Tobacco, owned by Sigma Consulting, is considering acquisition of the state-controlled tobacco holding Bulgartabac, CEO Boycho Kachulev unveiled. Kings Tobacco runs a cigarette factory in the country’s second largest city of Plovdiv , which was previously owned by Bulgartabac. As recalled, local candy trader Sigma Consulting acquired 78.18% of the idle cigarette maker for BGN 30.8mn (EUR 15.7mn) in July after an auction held by the state-run tobacco holding Bulgartabac and later expanded its share to 100%. More than 320 employees work in the factory and their number is to reach 400 by yearend. A line for cigarette packages has been built recently and two cigarette production lines are to start operations in the near term. The company plans a new plant in Plovdiv , which will open 150-160 new jobs. It wants to raise its market share to 18% next year from some 8% at present. Kings Tobacco produces 140 tons of cigarettes per month, 80-100 tons of which are sold abroad. Sigma Consulting has invested some BGN 60mn in the factory until now.

The government owns 79.83% in Bulgartabac. A month ago, economy and energy minister Traycho Traykov said that Bulgartabac will be sold in a public auction for candidates pre-selected according to a number of criteria. Purchasing a share of the local tobacco harvest will be put forward as one of the requirements to the potential buyer. Major identified risks for this year’s development of the holding are increasing the excise tax as part of the harmonisation with the EU levels, high competition on the domestic market amid price war, lower consumption of tobacco products, higher prices of raw materials, limited access and higher costs of borrowing, among others.