Business Review Issue 17/2012 May 14 - 20

Facebook marketing: Galvea Kelly, CEO of social media agency Brand Nua, shares her insight into what mistakes marketers make on Facebook and how they can generate value from the site’s 4.7 million local users »page 12

ROMANIA’S PREMIERE BUSINESS WEEKLY

BRITISH INVESTMENT

IT AND ENERGY ARE THE HOT AREAS FOR UK COMPANIES THIS YEAR, ACCORDING TO REPRESENTATIVES OF THE LOCAL BRITISH BUSINESS COMMUNITY »PAGES 9-11

May 14 - 20, 2012 / VOLUME 16, NUMBER 17

3Q

Soft focus Cornelius Brody, CEO and founder of software solutions provider iQuest, talks recruitment and regional strategy with Business Review » page 4

PRIVATIZATION FRUSTRATION?

INTERVIEW

Market oriented Chinese telecom company ZTE is aiming to sell handsets on the open market, set up two production lines and help bring internet access to underserved areas, said its operations and strategy director Lorian Ovidiu Vintila » pages 6-7 RESTAURANT REVIEW

Branching out

Photo: Laurentiu Obae

What effect will the instatement of Romania’s second new government in three months have on the country’s longawaited privatization plans? »page 8

A tree growing inside a restaurant was not the only pleasant surprise when BR’s food critic went to Piata Dorobanti for lunch at Doncafe Brasserie » page 13

www.business-review.ro Business Review | May 14 - 20, 2012

4 NEWS

ENERGY

NEWS in brief ENERGY OMV Petrom net profit up 65 percent y-o-y to EUR 317 mln in Q1 on higher oil prices

MACRO April inflation rate falls to new historic low of 1.8 percent The annual inflation rate fell to 1.8 percent in April, a new historic low, from 2.4 percent in March, according to data released last week by the statistics institute INS. The central bank targets a 3 percent inflation rate in 2012.

The consumption price index (IPC) rose by 0.7 percent month-to-month in April, as food prices dropped by 0.11 percent, while non-food products and services grew 0.11 percent and 0.17 percent.

Prices have increased by 4 percent in the last 12 months (May 2011-April 2012) against the previous year, based on the IPC. Euro zone inflation stands at 2.6 percent in April, according to a flash estimate from EU statistics office Eurostat.

Members of the Association of Financial-Banking Analysts in Romania (AAFB) have estimated in an internal survey that annual inflation will fall to 2.2 percent in April, and reach 3.5 percent in December 2012.

MONEY Banca Transilvania net profit soars 73 percent y-o-y in Q1 The net profit of Banca Transilvania (BT) gained 73 percent y-o-y to RON 91.8 million (EUR 21.1) in the first quarter of this year, as net provisioning expenses were cut by 27 percent y-o-y to RON 83.8 million (EUR 19.3 million). Operational income rose by 12 percent y-o-y to RON 393 million (EUR 90.9 million), while expenses hiked 17 percent y-o-y to RON 200 million (EUR 46.2 million) in Q1. The cost-to-income ratio stood at 49 percent.

The lender’s net interest income rose by 4 percent y-o-y to RON 235 million (EUR 54.5 million), while net commission income was up 10 percent y-o-y to RON 98.4 million (EUR 22.7 million) and trading income rose by 31 percent y-o-y to RON 39 million (EUR 9.1 million).

Foreign firms ‘have put EUR 16 bn into energy since 2002’

Millennium Bank Romania losses narrow to EUR 3.4 million in Q1 The Romanian subsidiary of Portuguese Millennium bcp reduced its net loss by 88 percent y-o-y to a negative EUR 3.4 million in the first quarter of 2012, supported by a decrease of impairment charges, and the lender is focusing on a clear cost containment policy, said officials. Banking income dropped by 19.4 percent y-oy to EUR 5.2 million in Q1, while banking costs fell by 18 percent to EUR 9 million.

The gross volume of loans to customers was up by 19.2 percent to EUR 409 million at end-March 2012, while deposits gained 0.9 percent to EUR 295 million. Millennium closed one branch and now operates 65 units across Romania in Q1, while the number of employees was cut by 10 to 689.

TELECOM Cosmote Romania revenues grow by 9 percent in Q1...

The revenues of telecom operator Cosmote Romania, part of Greek group OTE, went up by 9.4 percent, to a total of EUR 117.4 million, in the first quarter of the fiscal year, ended March 31, 2012, reported OTE Group. The company’s EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) rose by 44.7 percent versus Q1, 2011. The EBITDA margin stood at 22.1 percent, up by 5.4 percent versus Q1, 2011. As of the end of March, Cosmote’s total customer base (including Zapp) was 6.4 million.

... whole Romtelecom revenues fall by 3.7 percent Romtelecom, part of Greek company OTE, saw its revenues fall by 3.7 percent in the first quarter of 2012, on the same period of 2011, to EUR 160.2 million. However, the company’s EBITDA rose by 82 percent to EUR 40.4 million. The company’s number of landline customers continued to decline by 5.4 percent in the first quarter of the year, to 2.44 million.

Meanwhile the number of Romtelecom’s subscribers to broadband internet went up by 8.9 percent to 1.15 million while DTH services, IPTV and digital cable services also grew by 11.8 percent to 1.19 million.

Brinel to invest EUR 1 mln in local data center Romanian company Brinel, based in ClujNapoca, has announced it will invest approximately EUR 1 million in a data center. Company officials did not specify the date when the investment will be made or any further details. The services that are most in demand are platform-as-a-service, storage as a service and data recovery, according to the company. For this year, Brinel estimates 20 new clients will use the center’s services.

“On the Romanian market, companies have become aware that virtualization leads to higher productivity, to reducing operational costs and ensuring the security of the infrastructure,” said Marcel Borodi, CEO and president of Brinel.

F

Courtesy of iQuest

The net profit of oil and gas group OMV Petrom gained 65 percent y-o-y to RON 1.38 billion (EUR 317 million) in the first quarter of 2012, boosted by higher oil prices and increased gas sales due to the harsh winter in the first two months of this year. The group’s sales rose by 21 percent y-o-y to RON 6 billion (EUR 1.3 billion) in Q1, while earnings before interest and taxes (EBIT) were up 51 percent to RON 1.79 billion (EUR 411 million). Net debt decreased by 44 percent to RON 1.3 billion (EUR 298 million).

“In Q1, the higher crude price and stronger USD against the RON positively impacted our results in the E&P segment whilst placing a further burden on R&M margins and volumes,” said Mariana Gheorghe, CEO of OMV Petrom.

3Q Cornelius Brody

CEO and founder iQuest How is the extensive recruitment program that iQuest announced for 2012 going?

In the first four months of the year we employed 40 people. We are in full swing and we will certainly reach the target of 100 employees for the current year.

The range of specialists we are recruiting is quite large: from software engineers to testing engineers, mainly intermediate and senior level.

We are looking for people who are specialized in Java, .Net, Mobile and Testing.

Why did the company focus on the west of Romania, opening development centers in several large cities there?

We were influenced in our choice by the western culture and the level of training offered by university centers in these cities. The training of software students is of a very high quality in Cluj, Brasov and Sibiu.

Our headquarters in Cluj numbers 308 people, in Brasov we have 87 employees, while in Sibiu, in the “youngest” iQuest center, our team has already reached 23 people.

At the moment, we have no further plans to expand with other development centers.

What will iQuest’s strategic focus be this year and what will change in your strategy?

We will continue to focus on strategic segments such as life sciences, financial services, telecom, logistics and mobile services. In 2011, iQuest posted a turnover of EUR 16 million, which represents a 40 percent growth on 2010.

The Western European market continues to represent over 90 percent of the iQuest business, while clients in industries such as telecom and life sciences maintain the highest weight. Local clients contributed approximately EUR 1 million to our turnover.

We expect a 20 percent growth in this year’s figure, to over EUR 19 million, based on the same approach to the market.

We do not plan to acquire other companies on the local market. We will continue to invest in quality, processes and training. otilia.haraga@business-review.ro

oreign energy companies operating in Romania have invested around EUR 16 billion in Romania in the last decade, employing around 54,000 people, according to industry representatives present at a conference on energy organized last week by the Foreign Investors Council (FIC).

Last year, these companies contributed EUR 4 billion to the state budget from VAT, income tax, excises and employers' contribution, but there are still hurdles in energy regulation. The largest foreign energy players in Romania include Enel, E.On, and GDF SUEZ. FIC representatives cite the red tape around land ownership and the low predictability of investment remuneration schemes as hurdles in energy regulation.

The main points raised in the power sector were the lack of liberalization in the electricity market after 2007 and unfair competition in electricity sales, coupled with low liquidity in the free market. Romania is due to deregulate electricity prices for companies next year, while for households the deadline has been extended to 2017.

The lack of transparency in the wholesale gas market and the stagnation of liberalization in the gas market remain challenges in the oil and gas sector, according to FIC members.

Modernization gap The energy sector needs around EUR 30 billion through to 2020 according to the Energy Strategy of the Ministry of Economy. In addition, the draft energy strategy released in April 2011 by the ministry estimates that investment of over EUR 40 billion is needed in electricity generation alone by 2035.

“We need at least 5,000 MW of additional new generation capacity to be built by 2018-2020,” said Eric Stab, executive chairman at GDF SUEZ Energy Romania, member of the FIC board and chairman of the Energy Task Force.

The energy sector needs between EUR 15 billion and EUR 20 billion in the medium term to modernize existing assets and build new capacities, mainly in electricity generation, according to FIC representatives.

Domestic electricity demand is expected to grow by 2-3 percent per year, but 80 percent of the capacity is more than 25 years old, and many of the power plants are coming to the limit of what they can do, according to Stab.

Over half of Romania’s electricity output came from coal and gas fired capacities last year, which was a year of drought, according to data from ANRE, the energy regulator. Hydro and nuclear generated close to 50 percent, while power output from wind remained low at 2 percent.

The increase of gas storage facilities and further investments in renewable energy sources were also mentioned as potential sources for developing the energy sector.

The FIC has 130 members whose combined equity investments exceed EUR 40 billion in Foreign Direct Investment, creating over 185,000 jobs. ∫ Ovidiu Posirca

www.business-review.ro Business Review | May 14 - 20, 2012

NEWS 5

FINANCE

IMF completes fifth review mission in Romania with guarded optimism

Finance minister Florin Georgescu negotiated with IMF representatives

R

omania has remained broadly on track with its reforms program under the EUR 5 billion stand-by agreement with the IMF, European Commission and World Bank, remaining safe at macro-economic level, although reforms in state-owned enterprises from energy and transportation are lagging behind, according to representatives of the troika.

Finance minister Florin Georgescu negotiated with the IMF a widening of the budget deficit to 2.2 percent of GDP to accommodate a partial 8 percent reinstatement of the 2010 public sector wage cuts and to start repaying social contributions collected from seniors with pensions over EUR 170.

IMF Romania mission chief Jeffrey Franks warned that the arrears of stateowned enterprises have started to increase once again due to electoral pressures, adding that the privatization program has also fallen behind. Romania had 645 state-owned companies with a combined turnover of EUR 13.3 billion, and arrears of EUR 6.6 billion in the first semester of 2011, according to the think tank Fiscal Council. These companies employed more than 300,000 people.

Romania is currently trying to sell minority stakes in several state-owned enterprises on the stock exchange, but up to now only Transelectrica, the grid operator, has got EUR 37 million through an SPO, and the program is already falling behind as Romania got its second new government in less than three months.

The IMF projects the economy will grow by 1.5 percent of GDP this year, while inflation should remain within the 3 percent target of the central bank. The annual inflation rate dropped to a historic low of 1.8 percent in April. âˆŤ Ovidiu Posirca

www.business-review.ro Business Review | May 14 - 20, 2012

6 INTERVIEW

ZTE lines up big plans for local telecom market Chinese state-owned telecom equipment company ZTE is rolling out plans to set up one production line for handsets and tablets and another for customer premises equipment, which includes digital television components and Wi-Fi routers. The company is also planning to sell its handsets on the open market and wants to equip schools with tablets. Lorian Ovidiu Vintila, ZTE’s operations and strategy director, tells BR he will put these plans on the table before the new Romanian government.

CV LORIAN OVIDIU VINTILA May 2007-present operations and strategy director, ZTE Romania June 2008 NTU Waseda Double MBA in Management and Technology, Tokyo, Japan April 2006-May 2007 country manager at Telecom Italia Sparkle, Romanian office April 2002-April 2006 national sales executive at Orange Romania July 1997- April 2002 dealer channel manager at Orange Romania January 1997- July 1997 sales manager at Motorola Communication Romania April 1992-December 1996 shop manager at Gepa-Grundig Electrocenter 1994-1999- Faculty of Psychology, Bucharest University 1987-1991- Faculty of Veterinary Medicine, Bucharest Photo: Laurentiu Obae

∫ OTILIA HARAGA What are the latest developments in ZTE’s strategy for Romania?

Just recently I had a meeting at the Chinese Embassy, where I was handed in the new strategy for Romania. We are talking about a financing line of tens of billions of USD. We are in direct connection with the Bank of China, the China Development Bank and Eximbank (Eximbank Romania has very good relations with Eximbank China), and in fact most banks that are interested in developing partnerships in Europe and Romania.

If Romania can attract this money, it would be great. The Romanian government needs to create a solid telecommunications infrastructure that it could rent to operators so that it can reach the so-called “blank areas” – towns and villages where, at the moment, there are no data or even voice connections.

The recently approved financing line

also covers the creation of ZTE production lines in Romania.

Why import them when we could make them here and then export them to emerging countries or Western Europe, since Western Europe is also importing them from China?

Have you discussed these plans with the Romanian authorities?

We will be meeting this week the new minister of telecommunications, Dan Nica, and his advisors, to find ways to invest in Romania and sign partnerships. To reach those blank areas, this can be done via optic fiber or via microwave transmission (point-to-point communication).

We must find together the way. If a railway passes through a certain area, we will use it to transport optic fiber. If that blank area is somewhere you can reach it harder by optic fiber, we will use microwave connections.

We have never and will never require state aid, because we have enough money. We have been motivated to collaborate

with Romania in the spirit of its good relations with China ever since 1949 (e.n.

Romania was the 3rd country to recognize the People’s Republic of China, on October 5, 1949).

We work with very low margins and very long terms for investment return because we understand this is the only way to survive on a highly competitive telecom market. We are currently approaching the market with an interest rate of approximately 2 percent while the return term can be 5-10 years, depending on the project.

What projects will be up for discussion?

A very important point is the creation of a production line for devices – which includes smartphones and tablets.

Approximately 100 employees are needed for a small-capacity production line. But if we are also talking about auxiliary services, it could require 200-300 employees, maybe even 500.

Another one is the creation of a production line for customer premises equip-

ment, which includes not only devices for digital television but also Wi-Fi routers and other types of equipment for the final user at home. It could employ about 200 people.

As stated by a European directive, we need to switch from analog to digital TV and for this we need certain equipment, which must be produced or imported.

Not only Romania needs to comply, but all of Europe, which means demand will be at European level. It would be great if Hungary, the Czech Republic, Belarus etc imported from Romania, not China.

Once these production lines are created, their end products will respect European compliance norms.

Have you decided where ZTE will open these production units?

I tend to favor Constanta. However, recently I was invited to Deva and Hunedoara, with a pool of talented IT&C people. In Hunedoara, there is already a Chinese bicycle manufacturer, DHS. Personally, I recommended Constanta because we would have a direct sea link – the equipment can come from Shenzhen to Constanta, which saves time.

The charge is downloaded from the ship

www.business-review.ro Business Review | May 14 - 20, 2012

and you need to take it to the plant. Here you can transport it from the port to the production line in one hour, or to Deva or Hunedoara in 12 hours. We must also take into consideration the road infrastructure that we want, but at the moment don’t have.

On the other hand, I saw Hunedoara is in fact a hub, since several highways meet there and go West.

What projects has ZTE begun in Romania?

We are trying, with Orange Romania, to open an excellence center within the Telecommunications Faculty in Bucharest to train students and teachers in new technologies. Some of the teachers will be trained in Romania, and others we hope to send to China so that they understand what R&D means and how a production line works, in our case.

We already have instructed some of the trainers.

Our plan is to replace the old 2G equipment and data transmission via copper with the new GPON (gigabyte passive optical network) equipment that transfers data via fiber optic. We also intend to swap 2G with 3G and 4G equipment because this is the future. We want to apply this program at the Faculty of Telecommunications in Timisoara and other universities as well.

What services and products does ZTE offer in Romania?

We cannot talk about services but turnkey solutions. To give you an example, the Zapp 3G network was entirely done by us.

Talking about GPON projects – fiber optic TV, internet, the landline backbone we are now creating with RCS&RDS – this is not a turnkey solution: we deliver the equipment and they implement it using their own teams and resources.

What turnover did ZTE post in Romania last year?

We ended 2011 with up to EUR 100 million. This year we aim to remain within the indicators traced by the company, between EUR 60 million and EUR 100 million.

If the Romanian state agrees to go into partnership with us, we are then talking about a turnover of hundreds of millions of EUR. I think we have somewhere around a 30 percent share on the telecom equipment market. With some operators, we have more than 50 percent.

We work a lot with RCS&RDS and operators in the Asesoft group, such as 2K Telecom.

How much has the company invested in Romania?

In 2012, I think ZTE invested around EUR 4 million here. Investments go into free consultancy we give operators and technical after-sales services. With some projects, even if they are turnkey, they are maintained from our own resources in Romania.

For example, if there is a problem that appears one or two years after the contract has expired, we go and solve it. We have a consultative approach while other companies have a cash-and-carry approach.

I would be very content if by the end of this year we would have helped national operators such as Radiocom, CFR Telecomunicatii and Transelectrica or the Ministry of Education.

ZTE is the fourth biggest producer of mobile phones globally. How does it rank in Romania?

Last year, about 4 million mobile phones were sold on the Romanian market, which includes phones sold by Orange, Vodafone, Cosmote and RCS&RDS, while the open market sold about 20 percent, nearly 700,000 handsets.

We have just finished discussions with the largest distributor of handsets in Romania and will sign a contract shortly to enter the open market. We already sell our phones and tablets in the stores of all telecom operators in Romania.

Last year, we sold nearly 200,000 phones in Romania. However, once we go on the free market, I estimate this number will reach 400,000 by the end of next year.

At the moment, we do not distribute tablets that are compatible with 4G in Romania because 4G services are not available here yet.

But globally, we do have such devices – we were at the Mobile World Congress in Barcelona with four 4G compatible models.

What do you predict will be the result of the spectrum auction this summer?

Personally, I believe a new foreign operator will enter the Romanian market, a Turkish company.

The Romanian market is highly competitive and has developed a great deal on voice but not enough on data services, in my opinion.

A great deal of investment needs to be put into 3G and 4G data transfer, equipment and coverage. ”

otilia.haraga@business-review.ro

World Class focuses on aggressive expansion

Mikael Fredholm, CEO World Class International

World Class has opened two new locations within five months. Are you planning to keep up this expansion pace?

World Class has both a very strong brand name in Romania and a very strong team that can handle an aggressive expansion plan so with this in mind we will continue to expand quite aggressively in Romania.

We will primarily in the near future focus on the Bucharest market since we find the strongest demand here. But we are also looking at other cities in the country but more conservatively since the awareness of fitness outside Bucharest is still quite low. We have now reached a point in Bucharest where the market is quite ready for more clubs and where fitness is not only accessible for the upper class but for a broader range of the population. We started off targeting the 5% upper income level in Bucharest and we have since outgrown our segment by far meaning that we now target a much broader audience.

What is the concept of the America House location?

World Class Fitness Center at America House is a fun, energetic and motivational place targeting people that want to escape their home or work to find a place where they can meet people, have fun and get in shape. The club has a lot of equipment representing the absolute latest in fitness trends. This club would definitely stand the competition in New York or any other major cosmopolitan city.

What are some of the most popular courses you are offering right now?

All Les Mills programs are highly appreciated (Les Mills is the biggest group training concepts provider). For CXWORX™ , BODYCOMBAT™, BODYPUMP™ and any other Les Mills programs World Class Romania has the exclusive right of use. Any other 'replicas' found in other fitness centers in the country are not authorized.

Also, new programs such as PortdeBras - Body Mind dance conditioning class, powered by Julio Papi, are very successful.

It is performed with physiological breaths in a slow motion rhythm, using specific sequences that educate the body’s posture in movement. It is a dynamic way to improve body control.

In terms of personal training concepts,.

Functional Training is very popular. Functional Training as a concept is to build on the solid foundations of what we have been doing for many years. We are designed to move in this manner and so, training like this prepares us for our daily tasks and jobs. Functional Training can be defined as movement or exercise that allows us to perform our tasks with better performance or efficiency How would you describe the local culture of fitness and wellness?

The percentage of the Romanian population that conduct any type of fitness related activity is very low, whether it is running, walking, cycling or going to the gym. This combined with a strong tendency for many people to eat unhealthy food is a ticking bomb for the Romanian society. This is a world wide problem but unfortunately an even bigger problem in Romania. We started to offer fitness for the most educated and successful people in Bucharest but now, with more clubs and more affordable clubs, we are making it possible for more and more people to start a healthy lifestyle. We now have 18,000 members ranging from the most successful CEOs and VIPs to students that understand the importance of an active lifestyle. Unfortunately there is a lack of truly professional fitness clubs in Romania and as I see it there is only a handful of clubs besides World Class that offer professional services.

Why would clients choose World Class over other gyms?

First of all I am happy when someone decides to start an active lifestyle, whether it is start running in the park, going to a competitor of World Class or directly to World Class. In order to bring Romania to the same level as other European countries we all need to help people become more active. If a client chooses World Class that client will receive a very friendly and professional service, the latest group fitness classes led by highly trained instructors, the most professional Personal Trainers ensuring you maximum results.

A client choosing World Class will also find that we are organizing a lot of fun and social activities for our members – everything from member parties and fitness challenges to events ranging from running clubs, dancing with the stars, fitness in the park to cycling marathons. We have a very strong culture among our members and we are continuously trying to be the third place in our members lives, a social place outside their work and homes.

ADVERTORIAL

How does ZTE run its operations in Romania at the moment?

In Romania we have two offices in City Gate tower, on two floors. On the 11th floor there is the commercial and management department while on the first floor we have the technical department – sales, pre-sales and aftersales.

ZTE currently employs over 50 Romanians and 23 Chinese with work permits who are permanently in Romania.

We also have 60-70 temporary colleagues in the production and R&D centers, depending on the project.

At the moment we are looking to employ a sales director and two account managers.

In Romania we do not yet have R&D operations but I hope to start such a project here, since we have a very good pool of young talented people who are leaving Romania for better paid jobs.

ZTE already has R&D centers in France,

Switzerland and a point in Hungary.

Photo: Aurel Serban

What other projects will be under discussion?

We want to discuss an important project to bring internet to schools, where it does not exist yet, since we have vast experience of this in China. We hope to ask the new minister of education in Romania to create this infrastructure and equip schools with tablets.

At the moment, we produce tablets of 11 inches. Usually schools have desktops, but think about how much space they take up, while tablets can work just as fast.

INTERVIEW 7

www.business-review.ro Business Review | May 14 - 20, 2012

8 MONEY

Privatization program changes gear Romania wants to privatize five state-owned energy companies on the stock exchange this year for around EUR 1 billion, with the first breakthrough coming in March in the form of the Transelectrica SPO. However, the arrival of a new government and two rounds of elections may cast a shadow over the program, adding weeks of delay, warn market specialists. ∫ OVIDIU POSIRCA

“I believe that London is the best place in Europe for the international listings of SOEs” Dan Paul, president of the Brokers Association Changes and delays Florin Vladan, head of the Office for State Ownership and Privatization in Industry (OPSPI), resigned on May 7, the same day when the Ponta government was voted in by MPs. Vladan had been chief of the OPSPI for five months but had held other positions in the same office for two years. During his tenure, the secondary public offering (SPO) in Transelectrica, the grid operator, was oversubscribed, raising EUR 37.6 million for the government.

The second change of government in less than three months is expected to bring delays in the privatization schedule, but it is under scrutiny from the IMF, World Bank and European Commission (the troika). Romania closed a EUR 5 billion stand-by agreement with these insti-

Photo: Laurentiu Obae

Daniel Chitoiu, the new economy minister, said last Monday during hearings in the Chamber of Deputies, that the government would opt for a double listing of these companies and implement corporate governance at all firms included in the Economy Ministry portfolio.

“We will continue the privatization by selling on the stock exchange 10 percent in Hidroelectrica, 15 percent in Transgaz and Romgaz and 10 percent in Nuclearelectrica through a share capital increase,” said Chitoiu, quoted by Mediafax newswire.

The Ponta cabinet, which was voted into office last Monday, says the privatization program will continue only after an audit of the previous Ungureanu government is carried out and the real economic situation of these companies clarified. This audit will certainly be timeconsuming, say pundits, as all the acquisition contracts for goods and services, as well as consultancy services, will be evaluated to see if they were necessary and efficient.

Dan Paul, president of the Brokers Association, said during a roundtable on capital markets organized last week by the Bucharest Stock Exchange (BSE) that the government could opt for a second listing of state-owned companies in London. The domestic stock exchange signed a cooperation agreement with the London Stock Exchange this March in order to increase investors’ awareness of Romanian companies.

things that have to be done, we can’t always look for small legal issues as a reason to postpone things, because these big names can destroy your image before international investors, and we will need external financing in the future,” warned Anghel.

Gabriel Sidere, managing partner at law firm CMS Cameron McKenna, says the success of Transelectrica doesn’t guarantee the success of future listings where an individual and realistic assessment is needed, as each company has its own issues.

“Transgaz may be considered less attractive, due to a more reduced financial dimension, but at the same time we shouldn’t forget that Hidroelectrica – the ‘pearl of companies’ – operates with low profit margins,” said Sidere. Hidroelectrica reported a net profit of EUR 3.7 million last year.

For whom the bell tolls: Romania has several candidates for privatization prices, and authorities are investigating tutions and pledged to implement reforms in state-owned enterprises (SOEs), whether this constituted state aid. However, the Ministry of Justice has advised by selling non-viable assets, privatizing mithe government to contain possible risks nority stakes in energy companies and appointing private managers to these firms. by renegotiating these contracts instead of cancelling them.

Jeffrey Franks, head of the IMF misThe ambitious listing program brings sion in Romania, said last week the counto mind the wave of SOE (state-owned entry was lagging behind on improving the terprise) listings that was planned beprofitability of SOEs due to corruption tween 2004 and 2005, and ended up and inefficiency, advising the governwith the IPOs of Transgaz, the natural gas ment to focus on the listing program. transporter, and Transelectrica in 2005 “There are six companies – four of the and 2006. large energy companies and two in the “There were supposed to be more than transportation sector. The action has to be completed by the end of this year. Next, five IPOs for SOEs between 2004 and 2005, but only two happened,” said Septhere are the public offerings in Hidrotimiu Stoica, of counsel at law firm Salans. electrica, Nuclearelectrica, Romgaz and Transgaz and offers for Tarom and CFR “I am sure the market leaders will convince the government to continue the process Marfa,” said Franks, quoted by Agerpres of privatization and to enlarge it if posnewswire. “The slippages in the privatisible.” Stoica is a former BSE president. zation calendar continue in the context Miruna Suciu, partner at law firm of many tenders having failed due to preMusat & Asociatii, said that continuing ventable reasons.” the privatization of SOEs by selling miTom Attenborough, managing director at Citi Central and South East Europe, nority stakes on the BSE should remain an objective on the new government’s prisaid last week during a roundtable orority list. “We express our full trust that ganized by the BSE that the events of the the new government will adopt an adelast ten days have not made the process quate strategy, encouraging the trust for finalizing a “pretty ambitious” privaand interest of investors in the capital tization schedule any more straightformarket and in general for investments in ward.

Romania,” said Suciu.

“Personally, I hope the changes will deLucian Anghel, BSE president, caulay these listing only for several weeks,” tioned that postponing listings would said Attenborough. Citi is part of the impact investor sentiment, and added consortium selected to carry out the IPO that investment banks play a critical role of Hidroelectrica, the largest hydro-powin shaping Romania’s investment image. er generator in Romania, which is being “Intermediation contracts have been investigated by the EU in the “smart signed with big names such as Goldman guys” case. These are companies that Sachs and Citi. We can’t always postpone signed power contracts at advantageous

Power and the money The Ministry of Economy’s energy strategy stipulates that around EUR 30 billion of investment will be needed in the energy sector between 2007 and 2020.

Moreover, the draft energy strategy released last April says that investments of around EUR 30-40 billion are needed in electricity generation through to 2035.

“We need at least 5,000 MW of additional new generation capacity to be built by 2018-2020,” said Eric Stab, executive chairman at GDF SUEZ Energy Romania, during an event organized last week by the Foreign Investors Council on energy investments. The government has estimated the sector needs an overall investment of more than EUR 30 billion through to 2020, out of which EUR 18 billion would go on electricity generation, to replace aging capacities.

President Traian Basescu discussed the privatization of SOEs when he met with representatives of the troika last week. The president said that energy companies that are selling minority stakes should use the money to upgrade their infrastructure.

“At Transelectrica the money went to the state budget. But my opinion is that this money should be funneled towards upgrading technology in these companies, because we don’t intend to have a large privatization, rather for the amount required by these companies to ensure financing for upgrades,” said President Basescu.

The Property Fund estimates that around EUR 99 million will be obtained from the Transgaz SPO and EUR 278 million from the Romgaz IPO. The Nuclearelectrica IPO amounts to EUR 115 million, while the IPO in Hidroelectrica is valued at EUR 381 million. All these listings should take place by November, when parliamentary elections will be held.

ovidiu.posirca@business-review.ro

www.business-review.ro Business Review | May 14 - 20, 2012

BRITISH INVESTMENT 9

British investors turn to energy and IT After the protracted effects of the economic recession led many local UK investors to cut back on their investment budgets and scale down operations, 2011 brought the first sign of a recovery with overall British investments going up by almost 10 percent. UK investors are keeping a stiff upper lip and focusing on the full half of the glass, meaning new sources of future growth – energy and IT. ∫ SIMONA BAZAVAN “2011 was a difficult year for British investors because Romania is still recovering from the recession, posting a minimal growth in GDP. However, British companies are generally well managed and they coped well. I know of no British companies who left Romania,” Raymond Breden, executive chairman of the British Romanian Chamber of Commerce (BRCC), told BR. British firms invested EUR 69 million in 2011, up 9.58 percent against 2010, and making the UK the 11th biggest investor in the country, according to data from the National Trade Register Office (ONRC), cited by the British Embassy to Bucharest. The number of newly registered British companies also went up by 7.6 percent last year, totaling 4,437 firms.

Telecommunications, the pharma industry, construction and manufacturing are the fields where UK firms have a strong presence in Romania. And IT and energy are joining the list as investors look for new sources of growth.

Vodafone heads the line The first name that comes to mind when talking about the British presence in Romania is undoubtedly Vodafone. The UK telecom company has invested some EUR 2.7 billion in Romania since it started running operations here.

This year, one of its top priorities will be to secure the spectrum it needs during the auction of licenses organized by the Romanian state this summer.

Vodafone Romania had 8,327,280 customers at December 31, 2011, at the end of the third quarter of the financial year 2011/2012. Its mobile internet customer base grew by 77 percent quarter-to-quarter and by 75 percent year-on-year.

Meanwhile, revenues from mobile internet increased by 33 percent quarter-toquarter, and by 58 percent year-on-year.

Vodafone’s mobile average revenue per user (ARPU) was EUR 7.3 for the quarter ended December 31, 2011, a growth of 1.4 percent on the previous quarter and of 9.3 percent year-on-year.

At December 31, 2011, contract subscribers accounted for 41 percent and prepaid for the other 59 percent of Vodafone Romania’s total customer base.

Looking for healthy profits British pharmaceutical giant GSK invested some USD 141 million in Romania between 1998 and 2011, Pascal Prigent, general director of GSK Romania, told BR. Out of this USD 106 million went into the company’s factory in Brasov.

GSK plans to further consolidate its lo-

manager at Endava Bucharest, told BR. Romania is an attractive location for IT companies. The reasons for this are the good qualifications of graduates, geographical proximity to large global economic centers, cultural affinities, the IT infrastructure which is constantly developing and fiscal incentives for the IT sector, said Grosu. Only 9 percent of the company’s sales come from the region.

By the end of this year Endava plans to have more than 750 employees in its three centers located in Bucharest, Cluj and Iasi. As for sales expectations, Grosu said the company wants to maintain a similar turnover growth rate to recent years, of around 25 percent.

Finance factor

Flagship investments: no major British company has pulled out of the local market

cal business and says it wants to play an important part in the reform of the local healthcare system through continuous dialog with the authorities and medical services suppliers.

Prigent says the local pharma market is a contradictory one. On one hand there are obstacles, like the overall unpredictability and volatility, which make it hard for a company to make plans, and the lack of transparency in decision-making. On the other hand there are also many opportunities to develop the business. “We could say that there are unsatisfied medical needs (…) and the market will further develop as these people will require medical care and treatment,” explained Prigent. In 2011, the company’s investments in Romania amounted to USD 16.25 million.

Melrose finds a place on local market The local oil and gas sector has proved an appealing industry for UK investors in the past year. The British ambassador to Bucharest, Martin Harris, announced on his blog last October that Melrose Resources and its partners (e.n. Petromar Resources) will invest approximately USD 130 million in oil exploration in the Black Sea. Melrose Resources is a UK-listed oil and gas exploration, development and production company with core assets in North Africa and Eastern Europe.

In Romania, Melrose holds operated interests in two exploration concessions in the shallow waters of the Black Sea – Muridava and Est Cobalcescu. The two

blocks have a combined area of 2,000 sqkm and have proven exploration plays and attractive prospectivity, according to the company.

Melrose Resources is not the only British company interested in oil and gas exploration in Romania. Zeta Petroleum, an oil and gas firm founded in 2005 in the UK and acquired by an Australian company last year, attracted some USD 8.7 million this April under its initial public offering on the Australian Stock Exchange (ASX).

The money raised from this IPO will be used to fund the development of two onshore gas and oil fields the firm owns in Romania – Bobocu and Jimbolia. The Bobocu gas field is located 20 km northeast of Buzau and 110 km northeast of Bucharest. It was discovered in 1966.

Production started in 1977 but was abandoned in 1995 due to problems of sand influx in well boreholes from producing reservoirs. Jimbolia oil field is located about 40 km east of Timisoara on Romania’s border with Serbia.

Hiring local brains British IT company Endava posted a 60 percent growth y-o-y in its business in Romania in 2011, giving it a turnover of EUR 9.2 million, with a quarter of the company’s sales being achieved locally.

“Endava’s investments in Romania have so far created about 500 jobs. Out of this figure, approximately 100 jobs were added in 2011 and in the first five months of this year another 150 hires took place.

By yearend we estimate another 250 jobs will be created,” Radu Grosu, delivery unit

Britain’s Royal Bank of Scotland has been active in Romania since 2007 when it successfully led the consortium bid for ABN AMRO, and in October 2008 the bank was rebranded locally as RBS. Back in Britain, RBS, which received GBP 45.5 billion from taxpayers during the world’s biggest bank bailout, announced job cuts and asset sales at the beginning of the year in order to reduce its so-called “non-core” division.

After unsuccessfully trying to sell its local business last year, RBS Romania announced plans to sell only its retail division and focus on corporate banking, its initial core activity. In Romania, RBS had a EUR 1.26 billion exposure in 2011, down 4.5 percent y-o-y.

Elsewhere, consumer credit provider Provident Financial Romania reported a

British presence in Romania Number of Companies: 1,412 companies with “active” status registered in Romania at the end of March 2012, with more than 10 percent British shareholding Number of employees (2010): 32,887, up 2.9 percent y-o-y Turnover 2010: EUR 2.2 billion, up 8.6 percent y-o-y Financial status: At December 2010, out of all the companies, 894 (63.6 percent) recorded operating loss, up from 791 companies in 2009, 448 (31.9 percent) recorded operating profit, up from 402 in 2009 and 64 (4.5 percent) companies submitted nothing or did not declare an operating result, down from 213 companies in 2009.

Source: ICAP Romania

www.business-review.ro Business Review |May 14 - 20, 2012

10 BRITISH INVESTMENT

THE BEST OF BRITISH: UK HIGHLIGHTS Vodafone The British telecom company is the largest UK investor to Romania with EUR 2.7 billion spent here over the past 15 years. This year, one of the operator’s top priorities will be to secure the spectrum it needs during the auction of licenses organized by the Romanian state this summer.

Endava IT company Endava posted a 60 percent growth y-o-y in its business in Romania in 2011, giving it a turnover of EUR 9.2 million. The company has continuously expanded over the past years, reaching about 500 employees in Romania, and says it wants to add another 250 by yearend.

GSK British pharmaceutical giant GSK invested some USD 141 million in Romania between 1998 and 2011, out of which USD 106 went into the company’s factory in Brasov where it produces some of its international brands. Last year, the company’s investments in Romania amounted to USD 16.25 million. GSK plans to further consolidate its local operations.

gross profit of EUR 4.7 million in 2011 and revenues of EUR 63 million, due to improved lending activities.The number of customers increased by 20 percent y-o-y to 249,000, while the volume of loans taken out also gained 17 percent y-o-y to EUR 101 million.

Provident, owned by the British group International Personal Finance (IPF), has invested over EUR 125 million in the last five years, and plans additional investments of EUR 30 million this year.

The beginning of the year brought

changes for British insurance company Aviva in Romania. MetLife, Inc. acquired from Aviva plc its life insurance businesses in the Czech Republic (Aviva Czech Life) and Hungary (Aviva Hungary Life), and its life insurance and pension businesses in Romania (Aviva Romania Life and Pensions).

The transaction is expected to be completed this year, and is subject to regulatory approvals. The financial terms of the deal have not been disclosed. Aviva said last year that it had invested RON 243

Melrose Resources The British oil and gas company will invest approximately USD 130 million in oil exploration in the Black Sea. Melrose holds operated interests in two exploration concessions in the shallow waters of the Black Sea – Muridava and Est Cobalcescu – which cover 2,000 sqm and have proven exploration potential.

million (approximately EUR 60 million) in the local market, with a RON 30 million increase in social capital for 2010.

Willbrook goes green Last October Willbrook International completed the Willbrook Platinum Business and Convention Center. The scheme was built in compliance with green development guidelines following a total investment of EUR 100 million.

Willbrook Platinum Business and Convention Center, which comprises two

buildings, is located near Baneasa Forest with direct access to DN1. The buildings include five floors with 37,000 sqm of class AAA office space. The project also features a convention center with 2,100 seats, a fitness center and a 400-seat restaurant.

There are 850 parking spaces out of which 500 are underground. Realitatea TV, Pfizer and Samsung Electronics Romania are among the tenants in the project.

simona.bazavan@business-review.ro

www.business-review.ro Business Review | May 14 - 20, 2012

BRITISH INVESTMENT 11

Changing the flat tax would be a mistake, warn British investors Simplifying employment legislation, depoliticizing the public administration, developing the infrastructure, encouraging meritocracy in the civil service and the more assiduous application of the law are the main changes UK firms would like to see implemented in order to improve the local business environment, agreed company representatives present at the third British Investors Forum organized by Business Review last week. ∫ SIMONA BAZAVAN

EU membership – worth the wait?

Attendees also debated the benefits brought about by Romania’s EU accession, given that five years later the country has attracted only about 15 percent of the allocated funds while at the same time faces the rigors of being an EU member.

The accession was overall beneficial and Romania can still turn the situation further to its favor, it was posited. Proof of this is that the Romanian economy has

6

7

2

3

4

5

1. The event was moderated by Raymond Breden, executive

8

chairman, BRCC 2. Karim Kheirat, country manager of ICAP Romania, gave an overview of British companies in Romania 3.

Ovais Siddiqui, finance manager at Provident Romania 4. AnAll photos: Laurentiu Obae

No large British investor left the Romanian market in 2011, despite the fact that it was a hard year for all companies regardless of their nationality. However, some firms have had it worse than others.

The easy availability of credit during the boom time which led to an inflation of asset value and a lot of speculative development spelt the end for many companies in the real estate sector, said Gerry Eastwood, director at H&J Martin, the local subsidiary of a British construction company. And prospects are looking no brighter while lenders don’t resume financing. “Banks say their doors are open for business but the reality is that there aren’t a lot of funds available and that is hindering development,” he argued.

And while no major British companies have left the local market this doesn’t mean that some of them didn’t wish to, but chose to remain because of previously made investments in local assets, pointed out Victor-Dan Papala, senior manager at Baker Tilly.

Another topic tackled by attendees was the pros and cons of the local workforce, in particular what some described as the lack of loyalty of Romanian employees. Many companies complain about this issue and are reluctant to invest in employee development when the loyalty of their workers is so low that they are ready to leave the company if given an additional EUR 100 elsewhere, said Raymond Breden, executive chairman of the British Romanian Chamber of Commerce (BRCC) and the event’s moderator.

Angus Slater, chief marketing officer at Vodafone Romania, agreed that lack of staff loyalty has been a problem. He suggested the solution lay in making the basis of comparison between one’s company and its competitors about more than money. “We have tried to invest in training and build career paths for our people. (…) You need to offer a meritocratic system which gives them the opportunity to develop career paths,” he said, adding that this is not necessarily the prerogative only of large multinational companies. Career advancement can often be easier to achieve at smaller firms, he added.

1

grown considerably since the accession despite the crisis, argued Ovais Siddiqui, finance manager of Provident Romania.

“I think joining the EU was like the fall of communism. There were Technicolor expectations that everything would change overnight. This was unlikely to happen and I think that if we look at the accession process, and again the process is part of the story, it made us progress in a number of sectors; it forced us to improve and amend many, many things in order to join the EU. And I think we shouldn’t look just at the benefits for Romania but the multiple benefits for all of Europe,” said Princess Marina Sturdza, patron of the BRCC. One should be careful about criticizing Romania for not changing rapidly because in Western Europe, and Britain in particular, people object to some EU rules being imposed, stressed Breden.

Stability, stability and again stability Asked what changes they would make if they were prime minister, panelists said simplifying employment legislation, re-

gus Slater, chief marketing officer, Vodafone Romania 5. Princess Marina Sturdza, patron of BRCC 6. Gerry Eastwood, director, H&J Martin 7. Florentina Susnea, general manager, PKF Finconta 8. Victor-Dan Papala, senior manager at Baker Tilly

moving politics from and encouraging meritocracy in the public administration, developing infrastructure and applying the law more rigorously would be at the top of the list.

And while red tape continues to remain an issue in Romania, the lack of stability is probably more problematic, they argued.

This is an issue especially in the case of capital-intensive businesses. “A certain degree of certainty is necessary when talking about large investments,” stressed Slater.

“I probably spent the last ten and a half years learning to deal with the red tape as it is. If it is stable, than I can deal with it.

If it is constantly changing than we constantly have to relearn the bureaucracy and that is substantially more difficult,” pointed out Eastwood.

The same applies when it comes to fiscal changes. Asked their opinion on the possible abolition of the 16 percent flat tax and the return to a progressive taxation system, panelists largely argued that the change would not be beneficial – not only because of a possible hike in taxes,

but, again, because of the way it would affect stability. The measure would also significantly reduce Romania’s attractiveness in the region, warned Papala.

Regardless of the effects, Florentina Susnea, GM of PKF Finconta, said it was unlikely any such major fiscal changes will be made over the next six months.

The British give back The changing perception of CSR was also discussed at the event. Romania has always been a country with a strong civil conscience, thinks Princess Sturdza, and after communism destroyed much of this, Romanians are now rediscovering core values.

“My personal view is that CSR is actually moving towards the commercial center of a business,” said Slater, telling attendees that for Vodafone, being a responsible company is becoming more integral to the company’s commercial strategy thorough the products and services it sells and not only the through the money donated.

simona.bazavan@business-review.ro

12 LINKS

www.business-review.ro Business Review | May 14 - 20, 2012

Facebook marketing What can marketing professionals do to better engage with their Facebook fans?

GALVEA KELLY One in every seven people across the globe is an active Facebook user, according to a recent report conducted by the US Securities and Exchange Commission. The research shows that Facebook has 901 million monthly active users – a 33 percent increase over the 680 million users reported in March 2011.

Facebook strategies will no longer become a choice but rather a necessity for Romanian companies. Facebook penetration now amounts to 60.24 percent of the online population. In the last six months alone, the total number of FB users increased by 843,080 people, bringing the total amount of Romanian users to 4.7 million.

Engagement statistics show that an average of 3.2 billion Likes and Comments are generated each day and to date there

has been a staggering 125 billion friend connections made on the site. Photos are arguably Facebook’s most popular feature with more than 300 million uploaded per day.

What is interesting about these statistics is that they provide a deeper understanding of our evolving cultural norms: our values, our morals and our changing relationships with one another.

From a commercial perspective, 96 of the top 100 advertisers use the site. What is interesting is that although there were more than 42 million Pages with ten or more Likes at the end of March 2012, most marketers fail to derive value from these relationships. Engagement rates are now declining rather than increasing, which clearly indicates that marketers are failing to derive value from these relationships because:

1. They lack direction1.– In the race to develop their own Facebook page, a lot of marketers forgot an integral step: defining clear objectives. Now, it looks like there are a lot of brands out there whose only aim is to collect “Likes”. This lack of planning means that from a business perspective, fans don’t derive any real value from liking a brand.

2. Lack of understanding – Facebook is a very different platform from any other communications outlet marketers have used before – with its own very comprehensive set of rules and regulations. EdgeRank is Facebook’s system for deciding which content appears in the newsfeed. It is similar to Search Engine Optimization (SEO), which lists websites on Google’s organic ranking system, but requires a very different set of optimization skills. Facebook Ads are also very different in that they are a mix of banner and paid search. Marketers struggle not only to understand each of the pieces individually, but also how they work together and how they are evolving.

3. They don’t invest in resources – A gap exists between the amount of people engaging with Facebook and the investment companies are making in this area in Romania in terms of man hours, content development and sharing processes. In order to be successful in this area, marketers need to be dedicating the resources necessary to get the results they want from social media marketing.

4. They measure the wrong metrics – Marketers say that measuring Return on Investment (ROI) is their biggest challenge in measuring Facebook. Too many marketers ask “What is the value of a fan?” and not enough marketers understand their fans’ value in terms of loyalty and influence on Facebook’s impact on their business. Marketers won’t be able to prove value until they begin to ask the right questions.

In order to be successful on Facebook, collecting fans without a purpose is not enough; marketers must get serious about driving business results from Facebook.

In my experience, the goals for the majority of companies are to grow their fan base and improve brand recognition.

Facebook Pages present a massive opportunity for brands to directly engage with their existing and future customers.

However, simply creating a Facebook presence alone won't help you achieve these goals. To do so, take four steps to derive more value from your Facebook page.

1. Set clear objectives – If you don’t know what you want to achieve, you probably won’t achieve much at all. Define ob-

BIO Galvea Kelly Galvea Kelly is the CEO of Brand Nua, a social media agency located in Ireland. With experience in the early days of online community building, she has devised many social strategies for companies worldwide.

She is a speaker, researcher, consultant and digital video producer. Kelly guest lectures on MBA courses in Ireland and the USA and has had a paper published on the ROI of Social Media by the Marketing Journal. Currently based in Romania, she has worked in Ireland, the UK, France, Germany, the US and South America. Her client base includes Unilever, Toni and Guy, Berlin Festival, the Irish Embassy, Rugby Football Union and Kinetica Sports.

jectives that provide real value to your business.

2. Build a page that provides value for your fans. Bring focus to your Facebook marketing by building a brand page that not only accomplishes your business objectives, but also gives fans a reason to continually engage the brand.

3. Leverage Facebook tools to increase reach and engagement. A brand page shouldn’t sit on its own. It’s imperative that you combine features such as ads, events, and apps along with your brand page to get the most out of your network.

4. Integrate Facebook into your marketing mix. Facebook is not an island. It’s as important to integrate it with the rest of the marketing as with any other medium.

If you do not have the in-house expertise to execute a comprehensive social media strategy, it is best to seek the advice of an outside digital agency that possesses the appropriate skills to formulate an engaging content strategy plan.

Engagement is what I consider the key ingredient of Facebook. Social marketing is a relationship platform, not a campaign.

Brands that succeed on Facebook are the ones that give people a reason to be fans.

The change will require new thinking from marketers who had generally tried to accumulate as many fans and “Likes” as possible.

As you engage with your audience they will begin to know, like and trust you.

Content is king and marketers now need to deliver something of real value to the customer if you want them to share and interact with more content. This critical step is what is often required from them to purchase from you. ∫

CITY 13

www.business-review.ro Business Review | May 14 - 20, 2012

RESTAURANT REVIEW

A big hit

Photo: Laurentiu Obae

Criminally good desserts: the soufflé stole the show at Doncafe

Doncafe Brasserie 7 Strada Ankara 0746 222 444 DEBBIE STOWE For justice, we must go to Don Corleone. For lunch, we went to Doncafe.

I’m fairly sure this place has no mafia connections. There were no horses’ heads, nobody sleeping with the fishes and nobody left a gun but took the cannoli (though the desserts here are so delectable they would certainly be preferable as takeaway to a firearm). The Don nomenclature must come from somewhere else.

The café’s classy interior attracts a more legitimate upmarket business custom.

It’s located at a junction where two roads branch out from Piata Dorobanti, so has an unusual triangle shape. It’s all rich, dark wood and sumptuous seating, making this a comfortable and relaxing spot for a long sit-down. The only downside is the absence of both a non-smoking section and a terrace, which may deter the nicotine-averse and families.

Standing out among all the deep browns were two fluorescent colored Buddha statues. The other unexpected feature inside was a large tree, which must have preceded the building and been worked around so it sprouted out of the roof. Hats off to Doncafe for environmental friendliness.

There was also friendliness aplenty from our main waitress, whose pleasant demeanor contrasted with the can’t-be-bothered brigade employed at many Bucharest eateries. Only one drink order was forgotten throughout the afternoon and on the sole occasion when no member of waiting staff immediately noticed our meerkatstyle attempts to attraction attention, the manager (I assume) spotted us and swiftly and politely resolved the request. A good fella.

We were there for a late lunch (6pm is still lunch when you’re a freelancer) but

Doncafe caters for all times and all meals.

There’s a breakfast menu, with croissants (RON 6) and a few dishes named for London (a fry-up), Paris (croissants and beverage) and New York (toastie and eggs), that go from RON 21-26. We were too late to sample any but they have a good rep.

For lunch there are the Three S’s: soups, sandwiches and salads. Soup of the day was cream of tomato (RON 18), fully blended to a smooth consistency with a deep flavor. A compact and agreeable ciabatta Caprese (RON 17) yielded tomato and browned mozzarella, oozed pesto and had a lick of olive oil.

Cream of the crop aesthetically was an artistically heaped Asian chicken salad (RON 35) with carrot, celery and cabbage, the chicken marinated in a peanutty sauce and the whole thing doused in a garlicky, yogurt and white wine dressing. It was generous and composed with thought, making each bite interesting.

Being a brasserie, Doncafe also does a decent range of main courses. As well as a plat du jour on weekdays (RON 36-46) – an international rotation that includes a burger, Moroccan couscous and chicken tikka masala – there’s a selection of Italian and other European mains, including pork osso bucco (RON 36) with 1,001 aromas (we didn’t count), several meat and fish dishes, and some typical pasta choices (with the pasta said to be homemade).

We tried paella marinera (RON 34), a light, fragrantly fishy concoction that swam with generous amounts of mini mussels, squid, the odd prawn and white fish, with peas and tomato providing the vegetable presence (yes, I know the tomato is technically a fruit but it has the soul of a vegetable).

But top of the pile, the Godfather of everything we sampled, was the Belgian chocolate soufflé (RON 23), which my discerning dining companion accurately described as “molten deliciousness”. Satisfying compensation for the cheesecake (our first choice) being off the menu, it was rich, dreamy and decadent. Truly an offer we couldn’t refuse. ∫

www.business-review.ro Business Review | May 14 - 20, 2012

14 CITY FILM REVIEW

BUSINESS AGENDA May 16 10:30 Lenovo opens its first exclusive store at Unirii Boulevard no. 19 B. By invitation only.

10:30 Danone Romania organizes a press conference at Howard Johnson Hotel. By invitation only.

May 17 10:00 Terapia Ranbaxy organizes a press conference at Residence Hotels – Arc de Triomphe. By invitation only.

May 23 ∫EVENT 09:00 BR organizes the first edition of Focus on Agriculture at Ramada Plaza Bucharest. By invitation only. http://business-review.ro/br-events/

May 30 Tuca Zbarcea & Asociatii organizes a seminar on the fiscal implications of enforcement obligation and the assignment of debt at City Plaza Hotel, Cluj-Napoca.

The event will also address the impact of the new Civil Code and the new Civil Procedure Code. By invitation only.

Le Havre

June 11 -12 Bancpost organizes the delegation and business forum Go International, entitled Greece-Romania: At the Confluence of Regional Commercial Synergies, at JW Marriott Hotel. The event is supported by the Chamber of Commerce and Industry of Romania and the Hellenic-Romanian Chamber of Commerce and Industry.

WHO’S NEWS Business Review welcomes information for Who’s News from readers. Submissions may be edited for length and clarity. Get in touch at simona.bazavan@business-review.ro

Laura Toncescu has joined Nemoianu Attorneys at Law, the law firm affiliated to KPMG in Romania.

She will provide coordinated assistance to clients from specialized industries, such as banking, finance and insurance, mergers and acquisitions, capital markets, and other core legal areas. Toncescu will be a partner at the law firm (equivalent to senior director at KPMG). She brings more than 14 years’ experience, half of which have been focused on financial services.

Albert Davidoglu has been appointed business development director of Romanian importer and distributor of frozen products Macromex.

He has extensive professional experience in the FMCG industry having worked for Unilever for the past 14 years. Since February 2010 he has served as customer development director USCE responsible for Romania, Bulgaria, Serbia, Montenegro, Macedonia, Albania Kosovo and the Republic of Moldova.

Manuela Meres has joined Hilton Sibiu as conferences and events manager. She has

ISSN No. 1453 - 729X

previously worked for Athenee Palace Hilton Bucharest, where she held the position of PR and marketing executive.

Meres started her career in 2007 as office manager at Capgemini Romania, a consulting, technology and outsourcing company, member of Capgemini Group, and one year later took over the responsibilities of the marketing and communication department.

Simon Fearnhead has been appointed vicepresident responsible for finance, IT, legal and procurement. He is replacing Krzysztof Andrzejewski who has become vicepresident for sales and distribution within the company. Fearnhead has previously served as financial controller in the procurement division of the Swiss subsidiary of SABMiller.

Camelia Panait has been promoted to marketing director of Pivovary Topvar Slovakia, part of SABMiller. She joined the brewer in 2008 as marketing manager of Ursus Breweries after gaining an MBA in Spain. Since 2010 she has held the position of strategic planning director at Ursus Breweries Romania.

FOUNDING EDITOR Bill Avery EDITOR-IN-CHIEF Simona Fodor SENIOR JOURNALIST Otilia Haraga JOURNALISTS Simona Bazavan, Ovidiu Posirca COPY EDITOR Debbie Stowe COLLABORATORS Anda Sebesi ART DIRECTOR Alexandru Oriean PHOTO EDITOR: Mihai Constantineanu PHOTOGRAPHER Laurentiu Obae LAYOUT Beatrice Gheorghiu

Any port in a storm: Marcel (André Wilms, right) and friends rally round in Le Havre

DEBBIE STOWE Director: Aki Kaurismäki Starring: André Wilms, Kati Outinen, Jean-Pierre Darroussin, Blondin Miguel On: Cinema City Cotroceni, Cinema Digiplex Baneasa, Hollywood Multiplex Times are tough in Le Havre. Ageing bohemian Marcel (Andre Wilms) has abandoned any pretensions to a literary career and now ekes out a meager living shining shoes to support his fragile wife Arletty (Kati Outinen) and fund the odd glass of wine in the local bar.

But while Marcel and his neighbors are hard-up, they’re not hard-hearted. When he happens upon an African boy, Idrissa (Blondin Miguel), on the run from the authorities after the container in which he was being smuggled to England was intercepted, the community rallies round to hide the lad from the officers of the inscrutable Inspector Monet (Jean-Pierre Darroussin).

The contemporary immigration theme is at odds with the cinematic tone. Though events are clearly set in recent times, the combined impact of the narrative, characters, costumes, cars and direction lends Le Havre the atmosphere of a much older film, and the opening scenes seem almost Hitchcockian. But the film soon settles into a less stylized work, a conventional tale of a close-knit community working together to thwart the jack-booted cops. Although if Le Havre’s law enforcers are jack-booted, they usually wipe them before they enter and PUBLISHER Anca Ionita EXECUTIVE DIRECTOR George Moise SALES & EVENTS DIRECTOR Oana Molodoi MARKETING MANAGER Ana-Maria Stanca SALES & EVENTS Ana-Maria Nedelcu RESEARCH & SUBSCRIPTION Lili Voineag PRODUCTION Dan Mitroi DISTRIBUTION Eugen Musat

search the premises: this is a gentle film.

Through the deft direction of Finnish helmsman Aki Kaurismäki, the high tension of the manhunt for Idrissa intertwines naturally with the simple comedy of the townsfolk’s attempts to help him.

Pulling it all together is a masterful performance from Wilms. A sixty-something shoeshiner and frequent debtor who once dreamed of literary greatness could have easily become a loserish figure of fun. But even before his selfless quest to help Idrissa, Wilms invests Marcel with a quiet dignity, almost nobility, through an understated yet commanding turn.

A similar thing is going on with other characters, notably the highly strung Arletty and superannuated local rocker Little Bob (Roberto Piazza). We laugh with, not at, Kaurismäki’s creations, and the director pitches the pathos to maintain our respect for them. As the trilby and trench coat-clad antagonist Monet, Darroussin strikes the right sinister notes without overplaying it.

With its old-fashioned atmosphere and a standard plot that develops rather predictably, Le Havre veers close to soap opera territory. This homage to neo-realism contains no surprises, so may not please viewers seeking novelty. But it’s a charming and ultimately uplifting movie, with a warmth than more than makes up for what it lacks in artistic risk. It would take a stony heart to remain unmoved by this humane story of solidarity with outsiders, a Finn’s take on the very French themes of liberty, equality and fraternity.

ADDRESS No. 10 Italiana St., 2nd floor, ap. 3 Bucharest, Romania LANDLINE Editorial: 031.040.09.32 Office: 031.040.09.31 Fax: 031.040.09.34 EMAILS Editorial: editorial@business-review.ro Sales: sales@business-review.ro Events: events@business-review.ro