Business Review Issue 7/2014 March 2 - 9

www.business-review.eu Business Review | March 3 - 9, 2014

NEWS 3

NEWS in brief ENERGY

INSURANCE

LOGISTICS DB Schenker invests EUR 80,000

MOL Romania sales up 7 pct in volume last year

Gothaer Group plans to buy remaining stake in local subsidiary

in compressed natural gas infrastructure

MOL Romania, part of Hungarian group MOL, sold 503,000 tons of fuel, lubricants and liquefied petroleum gas in Romania in 2013, 7 percent more than in 2012, said company officials. The biggest increase was registered by diesel fuel, of which MOL sold 365 kilotons, an 8 percent increase compared to 2012. Gasoline sales were up 6 percent to 133 kilotons.

In Q4, MOL Romania’s retail sales increased by 7 percent versus Q4 2012, to 130 kilotons. Diesel fuel registered sales of 94 kilotons in Q4 2013 (up 7 percent), while gasoline posted sales of 34 kilotons (up 6 percent). The company’s network currently includes 147 gas stations and should break the 150 barrier this year, according to Kinga Daradics, the company’s GM.

Germany’s Gothaer Group said last Friday it was planning to buy the remaining stake in its Romanian subsidiary from two local shareholders, in a bid to sustain long-term development in the country.

The insurance firm will buy the stake from Constantin Toma and Efraim Naimer. The deal is in the documentation stage and will be submitted to regulators for approval.

Jurgen Meisch, CFO of Gothaer Group, said that taking full ownership of the Romanian subsidiary was the best way to strengthen the insurer’s presence in the country. In 2012 Gothaer Finanzholding, the firm’s financial arm, took over a 67 percent stake in Romanian insurer Platinum Asigurari Reasigurari. Following the acquisition, the company rebranded itself last year as Gothaer Asigurari Reasigurari. At that time, Meisch told BR the insurer had the option to fully acquire the subsidiary on the long term.

Gothaer reported gross written premiums of RON 66.7 million (EUR 15.1 million) last year. The insurer employs over 180 people in Romania.

Logistics and transport services provider DB Schenker launched the first two local Iveco Daily trucks fueled by compressed natural gas (CNG) last week, along with two filling stations in Bucharest and Cluj-Napoca.

Albin Budinsky, CEO of DB Schenker Romania, said the new trucks reduce carbon emissions by 20 percent, adding that the investment is part of a wider group strategy aimed at protecting the environment.

Hidroelectrica reenters insolvency Hidroelectrica has reentered insolvency after several energy traders won their appeals at the Bucharest Appeal Court.

The traders moved against the former judicial administrator of Hidroelectrica, who rejected their claim for RON 1.3 billion of receivables.

The hydroelectricity generator exited insolvency last June after 371 days in which the trustee freed the company of loss-making power supply contracts with the “wise guys” of the energy sector. Remus Borza, the insolvency trustee, said at the time that Hidroelectrica’s filing for insolvency on June 20 2012 had proved to be a “wise choice”.

The “wise guys” were traders that secured long-term electricity supply contracts at preferential prices, incurring massive losses for Hidroelectrica, sending the company to the brink of bankruptcy.

WEEK in numbers

EUR 100 mln the investment sum lost by the local generic pharma industry in the last five years, due to the growing claw back tax, according to the Association for Generic Medicine Producers (APMGR)

IT Star Storage sells major stake to Axxess Capital, receives EUR 5 mln capital inflow Romanian provider of storage, outsourcing and cloud solutions Star Storage has announced that Axxess Capital, via the Emerging Europe Accession Fund, has purchased a major share package in the company.

Star Storage has annual revenues in excess of EUR 20 million and more than 400 employees, with operations in Romania and the Republic of Moldova. With this transaction, the firm received a capital inflow of EUR 5 million which will help grow its capabilities to deliver cloud services, improve its operations, approach new market segments and geographies, and expand its IP and assets in emerging technologies.

Star Storage, which was founded

by Catalin Paunescu in 2000, has made three major investments over the past three years: a Tier-3 data center, a center for document conversion and digital archiving, and a document production center. While traditionally, the company used to focus on large clients, it has recently started to approach the mid-market and SME segments.

MACRO EC improves forecasts for Romania and Eurozone The European Union has upgraded its economic forecasts, predicting that a modest recovery is now sustainable as member states push ahead with reforms.

Romania’s economy is likely to expand at an annualized pace of 2.3 percent in 2014 and to accelerate to 2.5 percent in 2015, largely fueled by domestic consumption and investments, according to European Commission estimates.

The EC said it expected the 18-nation Eurozone to grow 1.2 percent this year and 1.8 percent in 2015, up from previous estimates made in November for 1.1 percent and 1.7 percent, respectively. By contrast, the Commission now expects deeper contractions in Cyprus and Slovenia. Across the EU, growth was also upgraded marginally, from a forecast of zero growth to 0.1 percent this year – rising to 1.5 percent in 2015.

RETAIL Praktiker sells local operations Praktiker sold its Romanian network last week after Search Chemicals, a Romanian company founded in 2003, bought the 27-store network that the retailer had locally. Earlier in the day, media sources had announced that Praktiker's operations in Romania were bought by Turkish businessman, Omer Susli. Susli is a shareholder in Search Chemicals and a former president of the Association of Turkish Businesspeople in Romania (TIAD).

At the end of 2011, the German group announced it would close stores in Germany and leave the Albanian market. A week ago, Praktiker sold its operations in Ukraine.

3Q Attila Peli head of development & land at Jones Lang LaSalle Romania

How is demand for land in Bucharest evolving?

A slight recovery is underway. The macroeconomic context and banks somewhat loosening their grip on loans are making many real estate developments – mostly office –feasible. This has persuaded developers, whose plans have been on hold for some time now, to start looking at buying land. Timing is very important for developers because in order to be on the market at the right time, they have to secure the land a year or two in advance. Yes, there has been a slight increase in demand for land acquisitions and this is coming from the office segment which is the least risky, both from the perspective of securing the financing and the ease of an exit..

What areas of Bucharest are of interest at present?

There is demand for downtown and there will continue to be for many years to come. However, some interesting submarkets have been developing. One is Casa Presei and Baneasa and there is also Barbu Vacarescu-Floreasca, including the Dimitrie Pompeiu area. One area which I think will develop considerably over the coming period is centerwest, meaning the Cotroceni and Polytechnic areas. I think there will be some significant transactions in that part of Bucharest this year.

What about land acquisitions for retail projects?

There are two segments to consider here.

One is big box retail developments for which land transactions will slow their pace, because many are reaching their expansion limits and because prices are going up. The other segment, and I am referring here to shopping malls, is also heading towards saturation, including in the capital. simona.bazavan@business-review.ro

www.business-review.eu Business Review | March 3 - 9, 2014

4 NEWS RESTAURANTS

WEEK AHEAD March 4 Business Clinics – Innovation Thinking Impact Hub holds a workshop on innovation starting from the Business Model Canvas. Vlad Craioveanu and Alexandra Pode (Impact Hub cofounders) will be your hosts for the event, which carries a RON 50 entrance charge for non-members.

09.30-11.30

March 5 Bucharest International Boat Show Boats of different sizes will be presented at the sixth edition of the biggest nautical fair in Romania, along with kayaks and jet skis, accessories and equipment.

Romaero, March 5-9

Every year, Business Review puts the spotlight on the achievements of the Romanian business community. The winners will be celebrated by an audience of top business leaders government officials and investors. Register for the gala by visiting the businessreview.eu website or emailing events@business-review.ro.

Athenee Palace Hilton, 18.00

Romania-Serbia Business Forum The Romanian Chamber of Commerce will host the Romania-Serbia Business Forum with the special participation of Zeljko Sertic, president of the Serbian Chamber of Commerce.

The forum will commence with a plenary session on the general growth perspectives for Romanian and Serbian business partnerships, followed by workshops covering different economic sectors. Participants are required to fill out a registration form on the CCIR website.

Chamber of Commerce Palace, A.I. Cuza Amphitheatre, 09.15-15.30

MOST READ www.business-review.eu 1 Praktiker sells its Romanian operations driving in Bucharest

3 Huffington Post: Bucharest, one of the best destinations for 2014, while it’s still cheap

4 Isarescu: Bucuresti is ready to enter the Euro Zone, but not Las Fierbinti

5 USL is FINISHED. Liberal ministers will resign en masse on Wednesday

R

INVESTMENT

Wave of regulatory changes disrupts foreign investors

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he Foreign Investors’ Council (FIC), the business advocacy group, said last week during a roundtable on transparency and predictability in policy-making that the approval of 115 government ordinances last year and the 39 changes to the fiscal code and 21 updates to the fiscal procedure code make it harder for investors to build long-term investments, denting the country’s competitiveness.

Mihai Bogza, FIC president, said that the business community has to be consulted on the enforcement of new taxes, which is a principle enshrined in law.

“The lack of transparency (e.n. in the consultation process) creates great uncertainty for investors from the point of view of costs and planning, and ultimately everything results in a suboptimal economic performance,” said Bogza.

FIC representatives have pointed to a lack of proper consultation on critical legislation regarding insolvency, the renewable sector and the fiscal code.

Bogza referred to the new insolvency code, which was designed to fix the

Photo: FIC

2 10 things you need to know about

branding, not profit.

After 15 years on the market, the La Mama team has almost 400 employers, working in its restaurants, production, deposits and headquarters, and almost 500 employers in the summer, when two La Mama restaurants open in Mamaia, Constanta county.

“Our best selling products are sour tripe soup, grilled minced meat rolls, meat rolls in cabbage with polenta, ‘pig's alms gift’ with polenta and jam and cream cheese dumplings,” said Mahu. The menu changes twice a year and the suppliers are all Romanian, although the products are not always made locally. The restaurants have an extensive wine collection, most of which are available by the glass, he added.

In 2013 Mahu invested over EUR 1 Catalin Mahu, owner of restaurant chain La Mama million in the restaurant in Mamaia Nord, which has almost 400 covers. omanian restaurant chain La every day, and the average bill comes 2014 will see no major investment, Mama has announced that it to EUR 17. The delivery service that only minor renovations of the current posted turnover of EUR 5.3 mil- the restaurant has developed since locations. Investments will also go lion for 2013, up 6 percent on 2012, on 2007 represents only 20 percent of into training the personnel and developing the quality of the compaa market that has been in decline since total sales.

2009. Profit represented approximately Asked by BR if sales had gone up ny’s products and services. Another 8 percent of the turnover, meaning during the Enescu Festival, Catalin major investment is being considered over EUR 400,000. Officials said 3,500 Mahu, owner of the restaurant chain, for 2015. ∫ Oana Vasiliu diners visit a La Mama restaurant said no, as Enescu improves national Photo: La Mama

March 6 Business Review Awards Gala

La Mama restaurant chain set to consolidate after EUR 1 mln investment

Mihai Bogza, FIC president

shortcomings in the current law, such as the cost of proceedings and the low level of receivables recovered by creditors.

“The (e.n. insolvency) code approved by government differs from what it was thought had been agreed between the interested parties,” said Bogza, who

added that the new code is now under debate in the Senate. The president said that the adoptions of new taxes last year, including a tax on special constructions and the creation of a new 7 eurocents fuel tax per liter on diesel and gasoline, should not have been necessary given the 3.5 percent economic growth in 2013.

Steven van Groningen, the FIC’s vicepresident, noted that the authorities are still passing bills without a proper impact study and changing the fiscal legislation frequently, without reasonable implementation deadlines.

Daniel Anghel, co-president of the fiscal taskforce at the FIC, acknowledged that the government had passed positive measures, such as the regulation of holdings and the VAT deferment on imports.

The FIC has 118 multinational members, accounting for EUR 35 billion in investments, which it says is roughly two thirds of the country’s total investment stock. These companies have created around 200,000 direct and indirect jobs in Romania. ∫ Ovidiu Posirca

www.business-review.eu Business Review | March 3 - 9, 2014

NEWS 5

ADVERTISING

IAA Global makes last-ditch appeal for dialog over controversial emergency ordinance

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of the IAA global board. “The appearance of media agencies on the market was a natural process because it addressed a need. We wish to send a message, hoping the Romanian authorities will hear us and we will get some kind of attention.”

The emergency ordinance is currently in force but has not been debated in Parliament. IAA representatives hope the law will be put on the table again for dialog with industry representatives.

“A visionary Ministry of Economy or Ministry of Finance should have reacted very fast to this ordinance because the revenues that will go into their budget will dwindle. Some very successful taxpaying companies have moved their budget into a black hole,” said Felix Tataru, senior VP of IAA Global.

A similar initiative has taken place in France, according to Michael Lee, managing director of IAA Global. “If there are divergent points between the industry and the authorities, the first step for the two parties is to sit at the table and discuss it. In France, there was a similar episode to the one in Romania, but the authorities accepted the dialog with the industry and the law

Photo: IAA

he global board of the International Advertising Association (IAA) convened in Romania for the first time last week, with a few items on its agenda. Paramount was to discuss the effects of emergency ordinance 25/2013 on the local advertising and communication industry.

The emergency ordinance was published in the Official Gazette on April 21.

The ordinance removed media agencies as intermediaries from the equation, putting TV channels in direct contact with advertisers. The measure is meant to bring broadcasters more revenue, but IAA representatives claim it has complicated matters for both advertisers and television outlets, with smaller agencies and TV stations bearing the brunt.

“We decided to have this meeting in Romania to express our support for the local industry, which has been affected as a result of the ordinance in April 2013.

Such initiatives are not a first at global level, but we, the IAA, have always stood by our members and have always been open for talks with the authorities to find the best solutions,” said Faris Abouhamad, president and chairman

Faris Abouhamad, IAA president

started to work.

Mihai Barsan, president of the managing board of IAA Romania, said the impact of advertising on the economy was very significant.

“In Great Britain, for every GBP 1 invested in this industry, the GDP grows

by GBP 6. In Romania, household consumption represents 70 percent of GDP, so economic growth depends on do-

mestic consumption, and advertising is one of the tools via which we can generate such an effect. Advertising stimulates innovation and entrepreneurship.

But for all of these positive effects to come about, the industry must be allowed to grow,” said Barsan.

The IAA board meeting in Bucharest is also a preview of the 43rd IAA World Congress that will take place in Beijing over May 8-10. One of the topics on the IAA Global agenda is to have global accolades granted by the IAA. “In some countries, the IAA organizes the Effie Awards, but this is not under our own brand. It is time for us to have our own brand. We haven’t decided anything for sure yet,” said Tataru.

The IAA board meeting also came on the occasion of the sixth edition of the IAA Romania Excellence Awards, which took place in February. “This year, we decided not to grant any awards in the media agencies section because emergency ordinance OUG 25/2013 has impeded development in this area,” announced IAA representatives. ∫ Otilia Haraga

www.business-review.eu Business Review | March 3 - 9, 2014

6 FORECAST

Feeble consumption undermines sustainable growth perspectives Exports and agriculture posting similar results to last year and ensuring economic and political stability are key ingredients in repeating last year’s performance. But in order for this to be the beginning of a sustainable growth cycle for the local economy, consumption has to go up and structural problems must be addressed, pundits told BR.

Bogdan Belciu, partner, management consulting, at PwC Romania

Flavia Matei, senior consultant at Ensight Management Consulting

aside the contribution of exports, growth would have been virtually nil,” added Bogdan Belciu, partner, man“In 2014 we will probably witness a agement consulting, at PwC Romania.

Local economic stability and the slowdown of economic growth, as in the best case scenario agriculture will fact that overall, emerging markets enmake a neutral contribution and in the joyed a boost of confidence in 2013, most probable scenario it will make a also helped, thinks Laszlo Diosi, CEO negative one. At the same time, con- of OTP Bank Romania. And it is worth sumption is unlikely to give a signifi- considering the poor results posted in cant boost to economic growth 2012, which make last year’s improved given that wage and credit growth will performance less surprising, believes remain low and the public sector Sergiu Negut, managing partner at still has areas to be restructured,” Mindit, associate dean at the MaasRadu Craciun, chief economist and di- tricht School of Management and rector in financial markets research at angel investor.

Given all this, is there any chance BCR, told BR. And he is not the only one cautious about making predic- the scenario will repeat itself this year?

Craciun believes this depends on tions.

Indeed, the European Commis- several factors, chiefly the developsion’s forecast for the local economy is ment strategy of several large inthat it will expand by 2.3 percent in vestors present in Romania such as 2014 and 2.5 percent in 2015, largely Ford, the evolution of the EU economy fueled by domestic consumption and and the capacity of Romanian firms to identify new export markets. investments.

While Romania’s agricultural perThis comes after the 3.5 percent GDP increase Romania posted last year formance is almost entirely weather– according to preliminary estimates – dependent, local companies remain surpassed all predictions. Everyone proactive in finding export opportuniagrees that the main two factors be- ties in order to counteract the dehind this were the good agricultural crease or stagnation of consumption year and the hike in exports, especially on the domestic market, meaning exthose of industrial products. The latter ports will most likely post a similar factor in particular was responsible for performance to last year’s. “From this the unexpectedly high level, Flavia point of view, we have very good sigMatei, senior consultant at Ensight nals from the European Union. Things have begun to improve visibly there, Management Consulting, told BR. “Without the evolution of the agri- and this creates a positive effect on culture sector, GDP growth would emerging markets. So I think 2014 is have been about half, and if we set very likely to repeat the positive re-

∫ SIMONA BAZAVAN

Laszlo Diosi, CEO of OTP Bank Romania

Radu Craciun, chief economist, director, financial markets research at BCR

sults of 2013, perhaps with improvement on certain segments,” Diosi told BR. The setting up of local service outsourcing centers is another form of export that is increasingly popular due to cheap labor and a permissive labor code, Negut told BR. However, this provides a limited window of opportunity that Romania needs to take advantage of, he warned.

On the other hand, Belciu believes that export growth will come from existing players. With Romania having benefitted over the past few years from the relocation of production to lower cost destinations, going forward he “doesn’t see a sustained flow of new investments”.

counteract this. “The expected growth in domestic demand might lead the Romanian economy to post a similar performance to 2013, although it may be offset by the increase in energy prices or increase in fuel excises scheduled for April 2014,” said Matei.

One thing remains beyond all doubt – Romania is nowhere near the pre-crisis period when economic growth was fuelled by skyrocketing consumption, albeit much of it supported by mass credit.

“We are not in such a scenario as the evolution of consumption is extremely anemic,” said Craciun, adding that economic growth has stemmed instead from a fortunate conjunction of elements. Meanwhile, Diosi believes the recent growth is the natural result of adapting to a completely different dynamic than the pre-crisis one.

Agriculture and industrial production remain important growth sources which need to be consolidated this year, but better use should also be made of other sectors such as energy and construction, he added.

At the same time, Romania needs to focus on attracting more foreign investments, especially considering that local capital is limited and financing remains difficult, said Belciu. “For this to happen, political and economic stability and predictability are again required, along with tax incentives, infrastructure, a skilled workforce and improving productivity, he concluded.

The beginning of a new growth cycle?

“What the Romanian economy needs to return to sustainable growth is consumption picking up, for which several premises are very important: increasing consumer confidence which rests on political and economic stability and predictability, tax incentives and the resumption of crediting activity – in a controlled manner,” he added.

Consumption was showing signs of improving at the end 2013; however, it is too early to say if this is the beginning of a consistent trend or the usual end-of-year shopping euphoria. Pundits remain cautious at best. And even if demand does indeed go up, some of the projected tax increases could

simona.bazavan@business-review.ro

www.business-review.eu Business Review | March 3 - 9, 2014

8 FOCUS

14 people to watch in 2014 They run companies whose business is measurable through its share in the GDP and the country’s annual exports, or firms trying to set precedents in their industries. They head ministries and institutions and their decisions directly impact the local business environment. Their challenges this year and the way they choose to address them will make the headlines and could directly influence the way business is done in Romania.

Who are they? ∫ OVIDIU POSIRCA, SIMONA BAZAVAN, OTILIA HARAGA

Nikolai Beckers, CEO of Cosmote and Romtelecom With the Romtelecom privatization and its potential merger with sister company Cosmote in the cards this year, all eyes are on German Nikolai Beckers, who is in charge of the task. Beckers took the helm of the two companies in April 2013, when he said his main priority would be to make them work as one and provide integrated services. The Romanian state will be selling its 45.99 percent stake in Romtelecom (with listing on the stock exchange as a preferred option), but Greek Group OTE and Deutsche Telekom will remain major shareholders. Reports in the foreign press suggest that Deutsche Telekom will strengthen its grip by taking over an additional 10 percent of OTE, on top of its current 40 percent.

Daniel Constantin, minister of agriculture and rural development The ministry he runs will have to decide this year under what terms local farmers and agribusiness firms will have access to the EUR 8 billion Romania was allocated by the EU for agriculture and rural development investments for the next seven years. More importantly, this will have to reflect the government’s development strategy for the agriculture sector for the next seven years, something that the authorities have had problems articulating so far.The Ministry of Agriculture and Rural Development (MADR) is currently in the process of drafting the first version of the National Program for Rural Development (NPRD) for 2014-2020 which should be sent to the European Commission by the end of February, according to previous statements made by Constantin.

Gelu Stefan Diaconu, head of ANAF Reform is the big theme for the Romanian National Agency for Fiscal Administration (ANAF) in 2014. Diaconu will have to convince taxpayers that the newly reorganized tax authority is capable of improving collection and is now better equipped to tackle the country’s deeprooted tax evasion problem. One clear target, albeit set by the former finance minister Daniel Chitoiu, is for the newly established antifraud department to raise between EUR 800 million and EUR 1 billion in fresh resources for the state coffers by this May.Improving tax collection remains vital given the local tax administration’s poor collection rate – 28.4 in 2012, compared to the EU average of 40.6 percent.

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FOCUS 9

Mariana Gheorghe, CEO, OMV Petrom A new royalties scheme for the oil and gas sector and shrinking local demand for energy are the main challenges facing Mariana Gheorghe, CEO of oil major Petrom. The company reported a net profit of EUR 1.1 billion last year despite weak gas and power demand and falling electricity prices. A decade of frozen royalties for Petrom will end this year, with the government planning to roll out a new taxation regime for the oil and gas sector. A new fuel excise tax of 7 eurocents per liter to be brought in this April will erode diesel and gasoline sales by 1-3 percent, according to Gheorghe. The offshore sector remains of great interest to the CEO, with the company aiming to resume exploration activities in partnership with oil major ExxonMobil by mid-2014.

Thomas Holst, country manager, Chevron Romania Shale gas and fracking are controversial topics. Although Chevron says it has carried out awareness campaigns in communities based close to its concessions, nationwide coverage of the industry was triggered by protests in Romania and abroad.Pungesti, where oil major Chevron was set to begin its first exploration operations, was center stage. The village was literarily under siege by police for a few days, but the company was ultimately able to begin exploration works. Holst has taken a cautious stance on protests, but has so far failed to outline the risks and benefits associated with fracking, the technique of pumping water, sand and chemicals at high pressure underground to break shale rock formations, say commentators.

Mugur Isarescu, central bank governor This may prove to be a challenging year for Governor Isarescu, who will have to make sure the local currency is not badly hit by potential political strife stemming from the European elections in spring, and the presidential race this autumn.The central bank will join the election fever as well. A new BNR administration board will be appointed by Parliament this October. Isarescu is a sure bet to keep the top job, while the other eight positions are still under debate, although Florin Georgescu, prime vice-governor, is also tipped to hold onto his post.

www.business-review.ro Business Review | March 3 - 9, 2014

10 FOCUS

Nicolas Maure, general manager, Dacia and Renault Romania After denying rumors it could leave Romania, French carmaker Renault has said the development of infrastructure, which could reduce delivery times, was a key “determinant for future projects in Romania”. This year Maure has taken over the helm at Dacia Renault and is tasked with keeping the industrial platform at Mioveni competitive. The local operations are facing stiff competition from Renault’s plant in Tangier, Morocco, where the infrastructure keeps delivery times lower. Nevertheless, the government needs to be convinced that building critical road infrastructure that would be used by the carmaker to export is a driver of economic growth and employment.

Adrian Sarbu, owner of Mediafax Group What’s next for media mogul Adrian Sarbu? Upon submitting his resignation as CEO of Central European Media Enterprises (CME), the firm committed to invest up to USD 3 million in a content business which he wanted to start. His unexpected resignation from CME in August 2013 was swiftly followed by rumors that he may be using the money to launch a new TV format. Will his future lie in TV or will Sarbu settle in better at Mediafax Group, which he is currently running? Earlier this year another rumor emerged that the group, which owns a news agency, several print publications and online platforms, is considering expanding its video department, according to paginademedia.ro data. As for CME, it is considering selling its brands in Romania, including the flagship channel Pro TV, but it may not have heard the last of Sarbu, who has pre-emption rights in the event that CME decides to sell the shares in its Romanian companies before the end of 2015.

Ludwik Sobolewski, CEO of the Bucharest Stock Exchange (BVB) This year has new IPOs in store for the BVB. Three state companies in the energy sector should be listed by summer in Bucharest and London. Although offerings in state companies have proven to be extremely popular among retail clients, Sobolewski wants more shares in these companies trading on the BVB. This involves educating the public about the possible risks and gains associated with investments on the stock exchange. Sobolewski may use some of the valuable experience he gained as head of the Warsaw Stock Exchange to woo more local private companies into listing.

Dan Sova, delegate minister of national interest infrastructure projects and foreign investments Securing financing and completing works on undergoing highway projects are the greatest challenges ahead for the delegate minister of major infrastructure projects in 2014. Only 90 km of highway will be delivered this year, but more will follow in 2015 as some 465 km of highway is presently under construction, Sova told a local TV station earlier this year.Another challenge is the passing of the new Public Private Partnership (PPP) law, which Sova says will help speed up the construction of road infrastructure, but which president Traian Basescu sent back to Parliament for reexamination in January.

www.business-review.ro Business Review | March 3 - 9, 2014

FOCUS 11

Tomas Spurny, CEO, Banca Comerciala Romana (BCR) Granting loans in the local currency has gained ground in the last two years, in a move pioneered by BCR, the biggest lender in Romania by assets. With a clean balance sheet, following a major restructuring of the business last year that axed jobs and reduced bad loans, Spurny says the bank is ready to finance the real economy.The lender has stemmed the rise in new non-performing loans, and cut interest rates on consumer loans and mortgages under the Prima Casa guarantee scheme. BCR hopes the move will generate a new trend in the market and see more banks gain confidence and restart lending activity.

Dragos Tanase, general manager, RMGC Selling a controversial 15-year old project to MPs is a daunting challenge, given the prospect of a crumbling political coalition and two rounds of elections. Add lackluster values for the parent company’s shares on top of litigation in court and street protests, and you can imagine a typical working day for Dragos Tanase, general manager at Rosia Montana Gold Corporation (RMGC), the mining firm hoping to start the project. Although the government passed a draft bill on the mining project, requiring a higher stake for the state and increased royalties, the Parliament killed it due to an insufficient quorum. Now hopes for the project are linked to a new mining law, which was initially supposed to be debated in February.

Eugen Teodorovici, minister of EU funds The challenge ahead for the Ministry of EU Funds is to increase the absorption rate of EU funds for the 2007-2013 financial allocation as far as this can be done at the 11th hour, and to prepare the ground for the 2014-2020 multiannual financial framework. After Romania managed to absorb EUR 2.8 billion last year, this year Teodorovici has set the target for at least EUR 3 billion to enter the local economy.

Another important issue on the minister’s agenda this year is to get banks more involved in the EU funds accession process. Lenders could step in to cover payments for a period when there is a funding gap from the state and could start handling project calls and overseeing the implementation period of EU-funded projects, as happened in the pre-accession period.

Zoltan Teszari, main shareholder, RCS&RDS What this elusive owner of Romanian-based telecom operator RCS&RDS might do next is anyone’s guess, given that he is extremely media-shy. However, since RCS&RDS will gain access to a 15-year telecom license in the 900 MHz frequency in April, which will allow it to deploy 4G services, one can only suppose the operator is right now taking steps to launch itself into the 4G battle. The firm is already known on the market for its aggressive strategy and low price plans. Teszari is also tipped to continue to make investments in renewable energy and real estate, such as the one he recently made in a bankrupt footwear plant. His final goal is to create a holistic telecom and content company that will offer both telecom services and TV, radio and online content and will be energy self-sufficient.

12 FINANCING SUPPORT

www.business-review.eu Business Review | March 3 - 9, 2014

Local SMEs struggle for choice in financing Whether it’s from banks, business angels, venture capital funds, crowdfunding, state aid or European money, SMEs in Romania need that extra nudge to make their business work, but statistics show that their options are still limited. BR found out more from the experts on potential financing paths in Romania.

Wealth of experience: local entrepreneurial development relies on culture and education as well as cash, says the Romanian Business Leaders organization

∫ OTILIA HARAGA While one third of entrepreneurs in the European Union believe the EU is the friendliest entrepreneurial environment, in Romania just 2.3 percent of entrepreneurs believe the place where they run their business is the most suitable for them, according to the Entrepreneurs Speak survey published last year by EY Romania, quoted in a report

by Romanian Business Leaders (RBL).

Romania is deficient in sources of financing, says EY, with loans for small entrepreneurs representing just 2.3 percent of the GDP, compared to a European average of 5.5 percent, and specialized funds nearly absent.

Furthermore, Romania also lacks

the tools to develop entrepreneurial a tunnel: if you don’t lift your head culture and education, claims the RBL. from time to time to see what’s outside, “We are dealing with a serious prob- all you want is a bigger pickaxe – or, in lem,” Mona Nicolici, head of commu- our case, more money. I am saying with nity relations & social affairs at Petrom, all confidence that more money means, tells BR. She quotes the Entrepreneurs in most cases, a waste or postponing an Speak survey which found that 88 per- unavoidable end, so pay close attention cent of Romanian entrepreneurs be- when looking for this money,” Sergiu lieve access to financing is “difficult” or Negut, managing partner at Mindit, associate dean at the Maastricht School of “very difficult.”

But it is not only about the money, Management and angel investor, tells some experts suggest. “The most im- BR. He recommends consultancy from portant limitation for SMEs looking for financing is that, in reality, they need “the usual expert” – an entrepreneur something else. Entrepreneurs are ex- who has gone through the same thing traordinary people who risk their time and can give advice such as that offered and money to create something new; during the entrepreneurship projects of they are dedicated people who work the Romanian Business Leaders Sumenormously for what they wish to mit.

The RBL supports as public policy achieve. Very often, this is like digging

priorities several initiatives, which include setting up a public-private entity with clear targets, governing rules and KPIs that should roll out programs for SMEs, lifting the red tape that stands in the way of small businesses and startups, and devising some mixed public-private financing frameworks (including seed funding or venture capital platforms) and revolving financing schemes that should replace the current non-reimbursable aid.

It is also working on five projects to promote entrepreneurial education.

Apart from workshops, it is holding a series of conferences given by businesspeople for high-school students in the main Romanian cities and publishes a practical guide written by entrepreneurs. Furthermore, it runs two men-

www.business-review.eu Business Review | March 3 - 9, 2014

FINANCING SUPPORT 13 Romania) and resort to crowdfunding.

“Right now, crowdfunding is not frequently used in Romania, and Kickstarter, the most used crowdfunding platform in the US, cannot yet be used legally from here. Even so, there are a few success stories where people have managed to finance their activity via crowdfunding. An example is FaceRig, a Romanian start-up which carried out a crowdfunding campaign using Indiegogo and managed to raise over USD 300,000, even though its initial target was USD 120,000,” says Iordache.

A special case involves businesses with a social impact, which can also apply for financing from Tara lui Andrei, a project backed by Petrom.

“Social entrepreneurship is strongly repositioning itself as a niche sector, which is attracting both NGOs and those within the traditional entrepreneurship zone,” says Nicolici.

She quotes the Social Economy Atlas, put together by the Foundation for the Development of Civil Society in Romania, which states that there are over 26,000 organizations active in the social economy – some of which are social businesses – with revenues of EUR 1.5 billion. Out of this sum, 18.5 percent are revenues from economic activities.

They employ over 163,000 people, representing 3.3 percent of the total number of employees, compared to the EU average of 6 percent.

Tara lui Andrei has so far organized three competitions that granted total financing of EUR 560,000 for 51 projects in 2013. “Fabricat in Tara lui Andrei is the largest competition for social businesses in Romania, through which Petrom offered total non-reimbursable financing of EUR 350,000. It is meant to develop social businesses in local under-developed communities in Romania,” says Nicolici.

Apart from financing, the 20 finalists got access to workshops and individual consultancy. In the first years of activity, they will also benefit from ‘business-incubator’-type consultancy.

“We believe entrepreneurship is learnt from a very young age, and to create the leaders of tomorrow, we must invest in the youth. For this reason, ten financing lines of EUR 5,000 each were granted for implementing businesses conceived and coordinated by teams of teachers and students in Scoala lui Andrei,” says Nicolici.

A total of 21 financing lines totaling EUR 15,000 were granted to sustainable projects from Tara lui Andrei in three fields: education, community development and the environment.

“A survey we carried out in 2013 with Cult Market Research revealed that over 88 percent of civil society representatives see social entrepreneurship as the main option of NGOs for development and self-sustenance,” says Nicolici. *The organizations consulted in the article are nominees in the Business Review awards.

Sergiu Negut, managing partner at Mindit and angel investor

Mona Nicolici, head of community relations & social affairs at Petrom

Bogdan Iordache, CEO of How to Web

toring programs: 101 Companies from Stress to Success, for entrepreneurs with at least three years of experience, and 1,001 Startups for newbies.

Currently, Romania still has around EUR 1 billion in untapped state aid, and local companies must submit projects by early spring to benefit from these financing facilities, said experts during the Access to Finance workshop organized by BR in January 2014.

The government is planning new schemes starting in July, although the allotted funding and criteria are still under consideration.

According to Iulian Sorescu, associated partner and head of the financial department at Noerr Finance & Tax, the schemes should in theory continue to focus on manufacturing and innovative/high value-added services, as the authorities aim to support the creation of new jobs.

The Romanian authorities put in place two state aid schemes worth a combined EUR 1.6 billion back in 2008, which were linked to the level of investment and the number of new jobs created. They focused mainly on manufacturing, although investments in medical and tourism sectors were also accepted.

One of the schemes, regulated by GD 753/2008, applies to investments of over EUR 100 million that create 500 new jobs. This has seen limited success as out of the overall budget of EUR 575 million, a little over EUR 100 million has been accessed by companies.

A second scheme, regulated by GD 1680/2008, applying to investments ranging from EUR 5 million to over EUR 30 million, with different job creation thresholds, has proved to be very popular with close to half of the funding having been taken up.

Under these two facilities, companies can use state aid to cover investments in assets such as productive buildings, machines, equipment and licenses.

A new scheme worth EUR 136 million, regulated by GD 797/2012, was rolled out in 2012, focusing on innovative investments and targeting the IT&C and R&D sectors, and around half of the

funds have been allocated. This facility allows companies creating over 200 new jobs to get finance for gross salaries and all related taxes for two consecutive years.

This may come as a breath of fresh air for many SMEs, since innovation is still an issue.

According to a survey by the National Institute of Statistics, innovation in Romanian companies declined over 2010-2012 compared to the previous two years. Furthermore, the number of companies that did not innovate at all grew by more than 10 percent over the same period. Only two out of ten SMEs implemented a new or improved product, process, management or marketing method over 2010-2012.

During the 2014-2020 EU financial period, Romania will receive EUR 22 billion in structural and cohesion funds.

These will be divided in the following way: for transport infrastructure EUR 5.7 billion, for the environment EUR 3 billion, for community urban development EUR 2.8 billion, for county roads and ring roads EUR 1.1 billion, to address youth unemployment and joblessness EUR 1 billion, for professional development in education EUR 1 billion, for social assistance projects EUR 1 billion, for SMEs and technological parks EUR 800 million, for research EUR 700 million, for IT EUR 550 million, for healthcare infrastructure EUR 500 million, for the development of local administration EUR 500 million, for the restoration of historical, tourist and cultural sites EUR 450 million, for education infrastructure EUR 350 million, for the cadastre EUR 300 million, for energy efficiency EUR 270 million, and for the programs of the National Agency for Labor Occupancy EUR 250 million.

“State aid and European funds have their upside and downside. They can be very helpful in developing a company if the project is for real. However, most projects are devised just to attract funds, and the economic effect is somewhat secondary. And the process is a very slow one. I know people who have barely received approval for a project submitted three years ago. How

relevant can such an old project be?

And how long will it take until the funds are actually released?” wonders Negut.

The bank would be another solution of choice for SMEs that wish to obtain financing, he suggests. “In spite of the general impression, banks are quite generous in granting loans, even though it seems that sometimes they do so when the company can do without it. Basically, loans for SMEs are available as soon as the company can cover and guarantee the installments.

In fact, there are a few banks, like Banca Transilvania, doing that systematically, and, not surprisingly, they have built a reputation in this field,” says Negut. He believes that bank financing is the most robust. “However, accelerating an investment for a dynamic company cannot be done only with money from the bank,” he says.

In the case of startups, the three Fs – family, friends and fools – is basically the starting point for everyone. “This is where the money that entrepreneurs have access to ends, and headaches begin. Big headaches, because, even though the business has been started, it is not bankable in any way,” says Negut.

Bogdan Iordache, CEO of How to Web, tells BR, “Romania is undoubtedly very poorly represented in financing from business angels and accelerators. Right now, there is no accelerator but only several business angels who are active. Nearly all of them are part of the TechAngels Association that I founded in 2012. There is definitely a need for more financing resources for start-ups, but also an efficient way to use that money, a thing that we have always lacked. On the other hand, right now there are two active investment funds in Romania, 3TS Capital and Early Bird Ventures,” he says.

Some 32 start-ups benefitted from the How to Web Startup Spotlight competition, with the best of them awarded USD 20,000.

Another option for an entrepreneur who wants to make his or her idea a reality is to take a nearly untrod path (in otilia.haraga@business-review.ro

www.business-review.eu Business Review | March 3 - 9, 2014

14 BR Awards

BR Awards 2014 EDITORIAL Bill Avery, founder

Romania, near and far

I continue to be baffled by the perception gap between what I read on the current Romanian business situation on sites like www.business-review.eu and the world press news reader apps I use to read about Romania on my smartphone or tablet. Locally, I know that business optimism and FDI continue to creep up; EU structural funds are finally starting to pour in; Dacia auto sales hit a high in 2013; and local retailers continue to invest in brick-and-mortar stores as well as their growing digital properties.

However, this dose of local reality and pragmatism never really comes through when I read about Romania in the international press. Sample pieces from around the world range from features on adopted Romanian orphans growing into adulthood in Canada; How Dog Lover Mickey Rourke is building an animal shelter in Romania; and from the Huffington Post, a piece on Romania’s fraying social safety net. What to do about Romania’s orphans, wild dogs and our dearth of medical services are all well-trodden themes. I know this first hand since Business Review was the pioneer in raising awareness around ‘Romania’s Brand Image’ starting in the late 1990s. Long-term readers know I’ve been fighting for a more balanced view of Romania as seen from the West since the beginning of this publication. We even brought British brand guru Wally Olins to Bucharest for the first-ever international conference on Romania’s brand image back in 2003 to finally get this process kick-started and gather

support for Romania’s entry into NATO and the EU. On a positive note, I will say that the tone of the international stories on Romania do reflect a higher awareness, sensitivity, better fact-checking, and sophistication as a rule, with recent outbursts from British tabloids on the subject of potential Romanian migration to the UK the exception. The new wave of Romanian cinema has been a wonderful influence in raising the level of discourse, portraying Romanian society pre- and post-communism in a complex, sensitive way, creating empathy for the people here navigating a wild form of capitalism, combined with heavy state intervention. I would not underestimate the influence of popular culture from film to pop music and sports on continuing to help moderate Romania’s image abroad.

We remain one of the few publications fighting Romania’s corner and promoting Romania as a viable place to do business in the international space.

As we gear up for our ninth Annual Business Review Awards event on March 6, we have four pages in this week's issue dedicated to initiatives to support and promote Romania's image abroad. That is because this year, at the BR Awards, we have a new category: Best Effort to Support Romania's Image, the winner of which has been decided by a public vote on www.business-review.eu.

I’m proud to be part of this dialog, and can’t wait to find out who this year’s winners across our 12 categories will be. I want to offer special thanks to our hard working jury members who researched and selected our winners, as well as our business partners who help make this one of the premier business events in Romania year after year! And of course, I want to give a big shout out to the Business Review team, who do a fantastic job in pulling this event together. We’re all grateful for the commitment.

Finally, to our loyal and new readers, we welcome you and invite you to stay engaged with us online, in print and in person, to stay on top of this wonderful, ever-changing Romanian business world. ∫ Bill Avery founding editor

2013 economy shifts to announce new developments This edition of the BR Awards acknowledges several important changes that happened last year in the local economy, mostly in the private sector. These changes, in our opinion, bear the marks of the new developments 2014 will bring. ∫ ANCA IONITA The major shift was attention switching to the entrepreneurial sector, perceived as an important future engine of a local economy deprived of its SMEs backbone over the past seven years.

Last year saw many initiatives in the sector of educating and helping young entrepreneurs to start their own business, with efforts coming from different stakeholders – from NGOs to private business associations – that became aware of the importance of education and know-how transmission in growing the future generation of local entrepreneurs.

Overcoming Romanians' natural fear of failure (especially in the currently uninviting business environment) is an educating process that will hopefully produce the long awaited mentality changes.

In order to acknowledge this effort, we are giving away a new prize this year: Best Start-up and SME Support.

In terms of funding the depleted local SME sector, 2013 saw many private initiatives focused on creating new and ingenious financing schemes for a severely under-capitalized part of the economy.

This call to action, through programs and events launched by companies and individuals, has secured other lines of funding dedicated to this sector, besides those opened by traditional lenders such as local banks or international institutions such as the EBRD. Making it easier for young entrepreneurs to access muchneeded capital, these programs also had an extraordinary emulating effect.

Last year brought a regrettable new high in the number of private and state-owned companies that filed for insolvency, with many lucrative companies struggling under the weight of taxation and debts.

This is why we thought it imperative to highlight the businesses that managed to complete a successful turnaround with a new addition to our awards list: the Best Turnaround prize.

Last, but not least, it looks like the improvement in the Western world's perception of Romania, which started at the beginning of the 2000s, has recently reached a critical mass. According to Princess Marina Sturdza, who for the past twenty years has been involved in child-protection organization active in Romania, very few of us are aware that Romania is now an international model of best-practices in the child-protection area, a dark spot which for many years tainted the country's international image, with only 8,000 children from the initial 120,000 still institutionalized.

Concerted individual efforts over recent years in the cultural and tourism sectors, internationally acclaimed events and works such as the George Enescu Festival of classical music and the film productions that make up the New Romanian Cinema movement, have helped change Romania’s distorted image.

This is why we have asked the online readership to propose and vote for what they believe was the best effort to promote Romanis’s image in the year of 2013. The list of nominees currently comprises of 11 names. Remains to be seen which one will take the new award home. anca.ionita@business-review.ro

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Business Review Aw

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BR Awards 17

wards: The Journey

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18 BR Awards

BR Awards the nominees

From greening their business to training the next generation of leaders, from funding SMEs to bringing an ailing company back from the brink, some players on the local market defied the tough trading conditions to shine in 2013. This year’s Business Review Awards celebrate these high achievers. Who are they, and what did they do? ∫ BR TEAM

SUSTAINABLE BUSINESS PRACTICES JUDGING CRITERIA Incorporation of sustainable business practices; environmentally friendly products or services; greener than traditional alternatives; social sustainability; private financing; profitability; social impact of the business; the ability of the business model to be replicated; helping a community to become self-sustainable; sustained growth of the company; long-term view of the company in relation to the community and the environment; producing in Romania and involving the local community

Casa de Insolventa Transilvania for the “Insolvency: A Solution Not A Problem” campaign Last year the company rolled out an awareness-raising program informing managers and entrepreneurs of what insolvency actually means and how it can help bring about a healthier economy. The aim of the campaign was to recognize insolvency as a segment that contributes to the economic growth of the country and turn insolvency into the business consulting area with the best coverage in the Romanian media.

Holcim Romania for the waste heat recovery installation at its Alesd cement plant The nomination reflected the company’s environmental performance, which is in line with the 20-20-20 goals of the European Union: a 20 percent increase in energy efficiency; a 20 percent reduction in greenhouse emissions; and the overall efficient use of resources.

The waste heat recovery facility at its Alesd cement plant is one of many initiatives introduced by Holcim Romania to improve its environmental performance. The total value of the investment was EUR 15 million and came from Holcim Romania’s own funds, with an amortization period of ten years. For Holcim, it is the first WHR power plant in Europe.

Danone for the “A Chance for Your Family!” Program "A Chance for Your Family!" is aimed at small farming communities in areas with low development potential, encouraging them to set up associations in order to secure long-term profitability through high-quality milk production.

The basic idea of the program is “passing on the gift”: pregnant cows are given to families who lack the means to invest in purchasing a purebred animal. The milk produced by the largest community is collected and used by Danone for its dairy manufacturing, but this is at the discretion of the community, which is not obliged to sell to Danone. The farming method is traditional, and environmentally friendly.

The program, which ran in three communities (Zimnicea, Teleorman county; Cocorastii Colt, Prahova county, and Belin, Covasna county), benefited from a EUR 595,000 investment in 2013, bringing the total for 2012 and 2013 to EUR 2 million.

CCIFER for the CCIFER training center In 2013, the French Chamber of Commerce, Industry and Agriculture in Romania (CCIFER) launched its Executive Management Program (ExMP), a ninemonth training course which aims to provide a 'helicopter view' of the main managerial disciplines and equip managers with an understanding of the driving forces of the business environment.

ExMP’s class of 2013 was made up of 15 participants and throughout 2013 the organizers recruited and admitted another 15 high-potential managers for the class of 2014. The tutor and accompany their participants throughout the program through a real-case business project.

ONLINE STRATEGY FOR BUSINESS DEVELOPMENT JUDGING CRITERIA The response generated by the project in terms of revenue, community building, public awareness; investment in the online strategy, platform etc; innovative character of the online project in reference to the local market and the respective industry

elefant.ro for moving to a family-mall concept The company was nominated for its transition in 2013 from an almost exclusively book-based retail business into an online family mall, with a diverse range of merchandise. Using a typical retail strategy, elefant.ro moved to increase its stock to more than 100,000 products for its 300,000 customers. In 2013 the company doubled its revenues versus 2012.

eMAG for its international development and expansion

into new product categories Last year eMAG achieved a revenue increase of more than 20 percent compared to the previous year. The international division launched eMAG in Hungary in October 2013. In Bulgaria the brand became market leader on the electro-IT online sector with a 50 percent market share. At the same time, the company developed its eMAG marketplace after nine different vendors were integrated on the platform in December 2013. Also in 2013, eMAG launched three new product categories: beauty, pet shop and a complete range of products for children.

Paravion Tour for its international expansion and various awareness-raising campaigns In 2013 Paravion looked to establish itself as the best travel website in Romania. Throughout 2012 and 2013, Paravion.ro took the first step towards expanding its activity in other European countries by launching www.paravion.bg, www.paravion.com.cy, www.paravion.com.tr, www.paravion.es, www.paravion.it and www.paravion.uk.com.

It launched a flight status SMS notification service, offering in-time personalized information to subscribers to this service when booking online, and a new feature, One Way Combinable Fares, which helps users find cheaper flights. In September, Paravion.ro officially launched the Paravion powered

by Vodafone mobile app.

ShopMania NET for the ShopMania BIZ cloud e-commerce solution Since ShopMania BIZ is a turnkey solution for creating online shops (point and click integrated platform, no coding needed from the client's end and full features made readily available), one of the company’s main objectives last year was to offer merchants more flexibility to customize their online selling platform. At the same time, it made complex UX and UI changes and added ten new built-in apps to the ShopMania BIZ system. In 2013, the ShopMania BIZ service type was re-branded under the concept of Cloud eCommerce, while the number of NGOs that can benefit from the ShopMania BIZ advanced service completely free of charge was increased.

ShopMania BIZ managed to expand its paying customer base by 53 percent, compared to 2012.

Vola.ro for its 2013 development The company’s main objective for 2013 was to consolidate its position as a one-

stop-shop solution for clients looking to research and book online various tourist services, from plane tickets to hotels and on-the-go packages such as city breaks. Another objective was to develop a sizable secondary line of business as part of Vola.ro’s efforts to diversify. The company invested in the technology platform for its business and migrated to its own technology from an "off the shelf" platform and set up a technology department in Cracow. Last year it also launched a city break business line.

INNOVATION IN TECHNOLOGY AWARD JUDGING CRITERIA Innovation and research-driven orientation of the strategy implemented; investment made, amount and against other markets where the company is present; the company’s HR effort

MB Telecom for the aircrafts x-ray scanner Roboscan Aeria The Roboscan Aeria, an aircraft X-ray scanner developed with company know-how and patented by MB Telecom, was completed. This is the most complex project in the history of the company to date, developed by focusing on a narrow niche in the aviation security market and investing massively in R&D. The prototype was awarded the Grand Prix at the Geneva Invention Exhibition in April 2013.

The first Roboscan Aeria serial product was displayed in November at MILIPOL Paris, the largest exhibition of military and security technologies in the world. The investment in the project was EUR 8 million over five years of R&D activities.

The Roboscan Aeria is the only possible solution to inspect the empty technical spaces in the fuselage and wings of an aircraft and assess within minutes the integrity of military aircrafts after combat missions. It can also be used for the technical evaluation of civil aircraft as part of security and customs control applications.

Bitdefender for the B-Have Technology With the B-Have Technology project, the company looked to develop top mobile security technology and acquire top ratings in testing sessions organized by world-class independent testing institutions. The B-Have Technology for mobile devices is innovative in that it optimizes the emulation of third-party software applications for mobile de-

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vices. The approximate project budget was EUR 1.6 million.

uberVU for the uberVU social analytics tool The social analytics platform bought at the beginning of the year by HootSuite is intended to establish itself as one of the top social analytics tools on the US market, focused on distilling large amounts of data in real time into a few key insights. The innovative part of the strategy was to focus on a strength within a few specific use cases (realtime social analytics) and use that strength to de-position its competitors.

The enterprise customer numbers as well as enterprise deal size within the target areas nearly doubled in 2013.

Avangate for its Customer Centric Commerce software With its main 2013 release of the Avangate platform, the company proposed an innovative Customer Centric Commerce blueprint for interacting with the new B2i buyer in order to secure future revenue streams. The Avangate platform was enriched in one release alone with over 1,000 Customer Centric Commerce features and enhancements.

BEST START-UP SUPPORTER JUDGING CRITERIA Number of start-ups/individuals supported; resources and strategy employed to support start-up activity (infrastructure, consultancy services)

Impact Hub Bucharest for developing Impact Hub Bucharest After launching The Hub Bucharest in June 2012, and putting in place the basis for the core community and co-working space infrastructure, 2013 efforts centered on building a diverse community.

The Impact Hub organized over 20 business clinic events. One big annual conference, Connection, featured 174 participants, 21 workshops and 30 guest speakers. The Impact Hub also piloted an acceleration program for impact businesses: the 60 Day Challenge, preparing social enterprises to have a sound business model, relevant skills, knowledge and be ready to be invested in.

Junior Achievement Romania for the startup program Junior Achievement (JA) Romania is the largest provider of entrepreneurship and economic education programs in Romania, reaching 180,000 students (K-12 and university) in 42 counties in 2013. The program seeks to identify and support these students by: providing them with access to volunteer business consultants, mentors and entrepreneurs (over 80 business volunteers involved in the past four years); offering access to finance through awards (over EUR 20,000 in the past four years for students startups, as well as an award of EUR 15,000 put up for the 2014 Com-

BR Awards 19 pany of the Year competition); and running Company of the Year, the largest annual inter-university entrepreneurship competition in Romania.The startup program also features a highschool track, run in 201 schools.

TechHub Bucharest for developing the first co-working space for tech specialists TechHub Bucharest was launched in early May and soon became the heart of the Bucharest tech community, hosting weekly meet-ups, open hours, mentoring sessions with international mentors as investors, as well as the most important tech events in the area. TechHub Bucharest is divided between permanent offices for resident members, coworking places, meeting rooms and an event space hosting weekly meet-ups on technology and entrepreneurship subjects.

Romanian Business Leaders Foundation for "101 companies from stress to success" Launched at the Romanian Business Leaders summit in February 2013, the program looked to help 101 companies grow from subsistence to prosperity entrepreneurship, over the course of a three-year project. It enrolled companies with a minimum EUR 100,000 turnover and at least three employees through the active involvement of Romanian business leaders

BEST FINANCING PROGRAM FOR SMES AND START-UPS JUDGING CRITERIA Amount of financial commitment and lending terms; innovative character of the financial product

EBRD for Romania SME Sustainable Energy Financing Facility (RoSEFF) The objective of this financing facility was to assist micro-enterprises and SMEs through dedicated debt facilities to banks, micro-finance institutions and leasing companies. Launched by EBRD in September 2011, it amounted to a total of EUR 60 million. The RoSEFF framework combines EBRD financing with EU-funded technical assistance and investment incentives for SMEs undertaking energy efficiency and smallscale renewable energy projects.

In 2013, the EBRD signed an EUR 80 million loan with BCR and committed EUR 5 million to BT Leasing Transilvania for SME financing. In addition, it signed a EUR 10 million financing deal with UniCredit Tiriac Bank to support investments in energy efficiency and small-scale renewable energy projects undertaken by SMEs.

Banca Transilvania for Contul Primul An Gratuit The bank looked to improve access to

loans for SMEs and launched a new product bundle called Contul Primul An Gratuit. With a financial commitment of RON 5.61 billion in new loans for SMEs, the bank granted in excess of 18,500 new loans to SMEs in 2013. Out of the start-up companies established in Romania, 31 percent signed up for Contul Primul An Gratuit, meaning 18,496 new clients.

How-to-Web for the How-to-Web event aimed at strengthening and empowering regional tech The How-to-Web tech conference includes the Startup Spotlight program and competition, showcasing some of the most innovative startups in Central and Eastern Europe, along with worldclass accelerators, investors and support programs. The 2013 competition provided startups with mentoring and training opportunities, encounters with potential investors and cash prizes of USD 20,000. The conference grew to 800 participants in 2013, including almost 20 accelerators from all over Europe and 32 selected startups chosen from many more applications

OMV Petrom Romania for Fabricat in Tara lui Andrei program The program aimed to develop the skills that Romanian entrepreneurs need in order to start social businesses, to create jobs and generate income by capitalizing on local assets (needs, opportunities and resources). One hundred social business ideas were entered for the competition, and 20 finalists will benefit from capacity building (financing to test their social business ideas and consultancy to develop them into business plans). The most sustainable ten will be financed by Petrom and receive business incubation support during their first years of business.

Venture Connect for the Venture Connect platform In 2013, Venture Connect continued to develop as a networking and learning platform for the entrepreneurial and investment community. Two new seed investments were achieved through the continuous efforts of the foundation and its partners, with more than 230 startups and entrepreneurs going through the selection pipeline. Startups pitching at Venture Connect came from Bulgaria, Macedonia, Hungary and Poland, as well as Romania. The investment community was represented by VC funds from Germany, Turkey and Switzerland, as well as business angels and accelerators from Bulgaria and Poland. One other key strength for the internationalization of the project was the close collaboration with Black Sea Trade & Investment Program.

Patria Credit for its financial products for SMEs Patria Credit last year took out a EUR 7 million loan from the Black Sea Trade and Development Bank (BSTDB) to fi-

nance, micro and small enterprises across Romania. The non-banking finance institution granted 5,000 new loans worth EUR 66 million in 2013. In March 2013, it launched a factoring solution for MSMS with annual turnover of under EUR 2 million. The main customers for this product were SMEs affected by cash flow problems, and EUR 850,000 went into 144 revolving applications.

BEST EMPLOYMENT INITIATIVE JUDGING CRITERIA Training programs and HR policies; staff turnover patterns; retention efforts and results against market trends and competitiveness

Hewlett Packard HP’s GEBOC 2016 center was designed to become the in-house business partner of choice for HP. In 2013, the company doubled the complexity of its job levels, striking close to a 100 percent increase in the top categories, with over 300 promotions. The employee engagement index is the best in the entire HP EMEA region – above 80 percent. Moreover, it registered 5,000 volunteering hours in social responsibility programs and trained more than 800 people in innovation alone.

Mega Image With 6,820 employees at the end of 2013, Mega Image created 1,300 new jobs last year for new store openings, totaling 3,500 new employees across the entire company (replacements and new positions). The company’s recruitment effort follows its continuous expansion.

Endava The company recruited over 100 students and IT graduates for its offices across the country, passing the 1,000employee target in its development and support centers in Romania. Endava has announced plans to grow its headcount in Romania by 25 percent in each of the next two years as well as to become Romania’s IT employer of choice.

Some 120 people signed up for and completed the company’s internship and graduate programs (a 60 percent increase on the previous year). In addition to the graduates, 80 percent of the people involved in internship and specialized schools programs went into permanent employment. At the end of January 2014, Endava employed 1,012 people.

SAP Romania In 2013 SAP aimed to expand its consultancy capabilities, by hiring both experienced professionals and recent graduates for all three near-shore centers in Romania. In 2013 it hired 156 people following the SAP Academy program, a 32 percent increase. Approximately 300 people have been hired in connection with this project since 2011,

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20 BR Awards a fourfold increase in the total number of employees.

BEST TURNAROUND STRATEGY JUDGING CRITERIA Strategy employed to achieve turnaround; time taken to achieve it; financial results of the company before and after

Hidroelectrica* Hidroelectrica, the hydroelectricity generator, exited insolvency last June after 371 days in which the trustee freed the company of loss-making power supply contracts with the “wise guys” of the energy sector. The stateowned company posted a record EUR 200 million last year. Hidroelectrica’s insolvency was a shock for the banking sector, which has exposure of close to EUR 500 million in the company. * In the meantime Hidroelectrica has re-entered insolvency.

which he founded in 2006, to California-based private equity firm Francisco Partners. It was the third exit for the Romanian businessman, after the sale of online payment processing company Gecad ePayment to Naspers in 2010 and the RAV anti-virus to Microsoft in 2003. The strategy of moving the company’s international headquarters to Silicon Valley has resulted in Avangate becoming a major e-commerce player in the North American market. The move also demonstrated the strong technical acumen of the Romanian technical and product development team.

Felix Patrascanu, FAN Courier Under his management, the company expanded the Express Loco service to national level, and inaugurated two new services: Collect Point in 153 OMV gas stations and the innovative Print&Go service. In 2013 it invested EUR 7 million in equipment and the diversification of added-value offers, while maintaining e-commerce as the company’s main focus for growth.

Blue Air

Dragos Petrescu, City Grill

In spring 2013, Airline Management Solutions, a newly set up firm owned by four Romanians, acquired low-cost carrier Blue Air for EUR 30 million, out of which EUR 28 represented the takeover of obligations. The new owners’ plans for the airline last year included the consolidation of the business at 2012 levels and the addition of new aircraft to the company’s fleet. The new management team also aims to grow the business by 3 to 5 percent in the coming years.

City Grill reported a turnover increase of 18 percent last year and won a raft of awards. The company plans to retain its position as the most important chain of restaurants and cafes in Romania and open a new restaurant in a well positioned location in terms of the flow of people and tourist attractions.

Diverta With 220 employees and 25 stores in 19 cities, Diverta looked to break even in 2013 and exit insolvency. The strategy deployed to reach these objectives entailed decreasing the sales area in top stores by over 30 percent, refreshing the product lines, upgrading the retail concept by redesigning the most important stores in the network and concentrating the communication effort on CRM. In 2013, after four years of negative results, the company reached a positive EBITDA of EUR 100,000 compared to minus EUR 300,000 in 2012.

ENTREPRENEUR OF THE YEAR JUDGING CRITERIA

Dragos Atanasiu, Eurolines Romania Group The top priority for 2013 was transforming a leading group in Romania into a company based on excellent customer service. In 2013 the company reported a 30 percent increase in sales volume (2013 turnover compared to 2012) and added 16 new units to the network. It also developed internationally, in Germany and Moldova, all in an industry that stagnated in 2013 at a national level.

Denisa Radian, SC Demiuma Comipex Denisa Radian heads the local fashion brand Nissa, which grew its turnover by 20 percent in 2013, while tapping into three new export markets. The company introduced a new brand for kids and achieved a 50 percent increase in online customers.

DEAL OF THE YEAR

Development of the business over the past two years; unique characteristics of the business; results achieved against investment and the overall industry; ethics and values embodied by the business

Financial details of the transaction; impact within the industry and the local business scene; new elements characteristic to the transaction

Radu Georgescu, Gecad Group

Romgaz IPO on the BSE

The serial entrepreneur last year sold the full stake in international e-commerce solutions provider Avangate,

The government raised EUR 390.9 million from selling a 15 percent stake in Romgaz, the state-owned natural gas

JUDGING CRITERIA

producer, in the biggest initial public offering (IPO) in Romania, which also included Global Depositary Receipts (GDR) that are trading in London. The company is aiming to discover new reservoirs inside and outside Romania, and to increase the recovery factor in mature fields, while optimizing the production from leased fields. The gas producer sold 60 percent of the shares and GDRs to foreign investors with the rest sold locally.

Raiffeisen Bank Romania’s acquisition of Citibank’s consumer portfolio Raiffeisen Bank Romania acquired the consumer portfolio of Citi, with the focus solely on the corporate sector. To facilitate the transfer of almost 100,000 customers (with over EUR 90 million in gross assets and over EUR 175 million in deposits), Raiffeisen Bank ran the “Citi-Retail (PI) Portfolio Buying & Integration” project. This gathered 125 employees, from 35 departments, from all the bank’s divisions.

UniCredit Tiriac Bank’s acquisition of the retail and royal preferred banking portfolios of RBS Romania In the second half of 2013, UniCredit Tiriac welcomed over 60,000 new clients from RBS Romania, thereby improving its position on the retail segment with the successful completion of the transfer of the retail and royal preferred banking business of RBS to UniCredit Tiriac Bank and UniCredit Consumer Financing. For the first nine months of 2013, UniCredit Tiriac Bank reported RON 206.1 million (EUR 46 million) consolidated net profit after minority interest, showing the effect of the RBS business integration.

Avangate acquisition by Francisco Partners Avangate was acquired in October 2013

by Francisco Partners, a leading private equity firm focused on late-stage companies. Francisco Partners has a track record of working with late-stage companies to maximize their potential for growth and profit. The acquisition will help Avangate expand the global footprint of its commerce platform, expand further its operations in the United States and emerging markets, and continue to innovate and improve customer commerce solutions for companies of all sizes. Avangate plans to grow its team by around 35 additional positions in 2014, most of them in Romania.

Getin Holding’s purchase of RIB Polish Getin Holding completed an agreement to acquire a 100 percent stake in Romanian International Bank last year. The holding is also active in Russia, Ukraine and Belarus and focuses on fast growing, high-margin market sectors such as retail and SME banking, leasing and financial inter-

mediation.

Romanian International Bank is a universal bank operating in retail banking and SMEs. It has more than 80,000 customers. At the end of the second quarter, the bank’s total assets amounted to RON 436.4 million. It has 34 branches in major cities around Romania.

BUSINESS LEADER OF THE YEAR Mariana Gheorghe, Petrom Mariana Gheorghe, CEO of oil major OMV Petrom, was named one of the 50 most powerful women in international business by Fortune magazine. She climbed five positions in the 2013 ranking to 27th. Gheorghe has been at the helm of Petrom since 2006, during which time the company has ventured into the Black Sea to seek new oil and gas resources in partnership with US oil major OMV Petrom. Last year, the oil company budgeted investments of EUR 1.2 billion.

Severina Pascu, UPC Severina Pascu, CEO of UPC Romania since 2011, was appointed to lead the company’s operations in Hungary in mid-2013, taking charge of the company in both countries. The operator’s Q3 2013 revenues stood at USD 34.7 million, up 11.3 percent on the same period of 2012. The operator launched internet speeds of up to 200 Mbps. Romania, along with Hungary, was the third European country where UPC offered this speed.

Xavier Piesvaux, Mega Image With Xavier Piesvaux at its helm, Mega Image maintained an aggressive expansion pace throughout 2013 by opening 104 new stores: 37 Mega Image supermarkets and 66 Shop&Go proximity stores. In September, Romania became the first country where the Belgian Delhaize group launched a new retail brand, AB Cool Food, which sells exclusively frozen foods. At the end of the year Mega Image operated a network of 296 stores in Romania.

Steven van Groningen, Raiffeisen Bank Last year, the bank’s main objective was to consolidate its position as a leading bank, capable of offering its customers local financial solutions that serve multiple financial needs and build profitable home bank relationships. The bank sought to create value by offering customer-centric solutions that are simple and convenient to use.

For two years in a row, Raiffeisen Bank was the most profitable bank in Romania. Moreover, as the bank managed in recent years to improve its efficiency and reduce costs, it was awarded within the group as the network with the biggest increase in efficiency.

www.business-review.ro Business Review | March 3 - 9, 2014

Monica Iavorski, Arctic In October 2013, Arctic inaugurated a new manufacturing line which boosted production capacity at the Arctic plant in Gaesti by 25 percent and which will create an additional 572 jobs over five years. The total investment in the capacity extension was EUR 23.9 million, out of which EUR 13.7 million was Arctic’s contribution and EUR 10.2 million was granted by the government through a state aid scheme.

Currently, exports represent over 85 percent of the total sales. The refrigerators produced in Gaesti go to markets such as Turkey, Poland, Spain, France, Germany and South Africa.

BR Awards 21 eMAG platform in several Eastern European countries, while increasing the categories and range of products within each category through its own inventory or new, third-party vendors through the Marketplace platform.

The international division launched eMAG in Hungary in October 2013, while in Bulgaria eMAG has become market leader on the electroIT online sector with a 50 percent market share. In December 2013, nine different vendors were integrated on the eMAG platform.

Galeriile Artmark

Business growth over the previous year; sustainable development strategy; top market position; quality HR policies; development of new best practices in a specific industry; adoption and implementation of industry best practices; spectacular turnarounds of troubled businesses (over the past two years); exceptional business growth compared with peers

Last year, Galeriile Artmark increased its number of clients and transactions, while total auction sale turnover exceeded EUR 10 million for the second year in a row. The number of clients was up 63.3 percent on the previous year, amounting to 566 new clients.

Artmark organized 37 auctions in 2013, two more than in 2012 and 12 more than in 2011.

With a 76 percent market share, Artmark is the only auction house in Romania and Eastern Europe to use an online live bidding system which allows real-time bidding over the internet. In 2013, 93 percent more lots were sold over the internet than in 2012, reaching EUR 773,630, a 54 percent increase over the previous year.

Automobile Dacia

City Grill

With EUR 104 million invested in new industrial projects in Romania in 2013 and the launches of the new Logan MCV and new Duster, Dacia remained market leader with a 31.6 percent market share, despite a decrease in the local car market.

The carmaker became the automotive brand offering the youngest vehicle range on the European market, by launching four new passenger models manufactured locally – the new Logan, new Sandero, Sandero Stepway and new Logan MCV – and three new models manufactured in Morocco – the Lodgy, Dokker and Dokker Van.

Last year the company posted a turnover increase of 18 percent and opened its newest location, City Grill Covaci in the Old Town. The company introduced a course to develop its chefs’ skills, called Chef’s Academy, and introduced loyalty and discount cards for its customers called “Out for food.”

EXCELLENCE IN BUSINESS JUDGING CRITERIA

OMV Petrom Petrom is the largest oil and gas group in South Eastern Europe, with activities in exploration and production, gas and power, and refining and marketing.

With a maximum annual refining capacity of 4.2 million tonnes, OMV Petrom is present in the oil products distribution market in Romania, Moldova, Bulgaria and Serbia through a network of approximately 800 filling stations, operated under two brands, Petrom and OMV. Last year, the company’s profit jumped 22 percent to EUR 1.09 billion, while sales fell 8 percent to EUR 5.47 billion.

eMAG In 2013, the company focused on expanding its presence as a regional ecommerce player by launching the

Touring Europabus Romania (TUI Travel Center) The company’s top priority for 2013 was customer service. An innovation manager was appointed and an entirely new customer care department created, according to “bounce back” principles intended to ensure that all customers become repeat customers. The sales network has grown, with a total of 16 new travel agencies being opened last year (the majority in shopping malls and commercial areas) while sales grew by 30 percent.

Tourism is the main growth driver, and on this segment the company reported an increase of 63 percent, while flight sales were up by 20 percent and coach tickets by 9 percent.

FAN Courier With a total of EUR 50 million invested over the past 15 years, the firm is looking to consolidate its market leader position and prepare for a transition from fast to very fast delivery services.

Last year, it upgraded its equipment and diversified the added value of its offers.

www.business-review.eu Business Review | March 3 - 9, 2014

22 PRIVATE EQUITY

Private equity eyes more exits on local market With deal-making by private equity players on the local market subdued by the economic crisis, and hovering around EUR 60 million annually over the past three years, more exits from companies with maturing investments may be imminent, while newcomers will be hard to come by, reckon pundits.

Meanwhile, Cristian Nacu, partner at Poland-based PE fund Enterprise Investors (EI), points out that no more than EUR 50-60 million has been put to work annually in the last three years.

Cornelia Bumbacea, partner, deals Pwc Romania

Mihai Pop, manager transaction advisory services, EY Romania

Cristian Nacu, partner Enterprise Investors

“For us in private equity, which targets growth and profitability, it has been hard to find attractive targets,” Nacu told BR. He reckons this year will not be “significantly different” although perceptions of the economy

have started to improve, due to better macro figures last year.

Nacu reckons Romania could see more exits this year, as a lot of PE investments have reached a certain maturity.

“In the region, there have been more exits in the recent period. In general, companies controlled by PE have done better in the crisis than others, because we established better management, and prepared the company for tougher

Deals by Value and Volume in Romania (2010-2013) 3,200

250 223

162 148 118 125

1,600

1,688 1,264

1,464 1,185

0

0 2010

2011

Number of deals (left hand scale) Source: EMISPRO DealWatch service

2012

2013

Total value of deals (EUR mn, right hand scale)

Source: Third Emerging Europe: M&A Report co-authored by CMS and EMIS

Gap between buyers’ and sellers’ expectations persists

Courtesy of Enterprise Investors

The number and value of deals has significantly dropped in the crisis period, with 2013 possibly being weaker than the previous years in terms of private equity (PE) deals concluded in Romania, according to Cornelia Bumbacea, partner, deals, at professional services firm PwC Romania.

“Although PE fund managers have looked at various businesses, reached preliminary agreements with owners on price and performed due diligence exercises in some instances, only a few PE deals reached final closure last year.

Given the moderate optimism for 2014, deal activity is likely to pick up,” Bumbacea told BR. “As some private equity funds have spent up their endowments and their investments have already reached maturity, we expect to see a number of exits this year. Opportunistic exits can always happen where there is an increased chance of getting a very good deal,” said Bumbacea.

Courtesy of EY Romania

∫ OVIDIU POSIRCA

Courtesy of Pwc Romania

Courtesy of Popovici Nitu&Asociatii

Florian Nitu, managing partner Popovici Nitu & Asociatii

www.business-review.eu Business Review | March 3 - 9, 2014

PRIVATE EQUITY 23

Source: Third Emerging Europe: M&A Report co-authored by CMS and EMIS

of future growth even if it looks flat at few years, but the legal changes have “rocked the confidence of some” in the present.

Number of Deals by Sector in Romania (2013) Florian Nitu, managing partner at law sector, according to the EI partner.

“We have in Poland a company that firm Popovici Nitu & Asociatii, told BR that PE giants have been able to put up makes investments in wind, and at Finance & new funds on the back of improved per- some point we had the idea of coming Other 34 Insurance 21 formances in mature financial markets. to Romania with that company, but at This means that new players may join present it is on hold. That company is the local market, he added, tipping en- acquiring projects,” said Nacu.

Manufacturing The sector has attracted over EUR 5 ergy projects, healthcare, and the logis15 tics and distribution sectors as billion in investments in the past four years. Large foreign utility firms have potentially attractive fields.

Manda of Axxess Capital sees good poured money into local projects, potential in IT, financial services and mainly wind, now in the red after the government deferred some green certhe building materials sector.

Wholesale & Media & “Investment decisions in private eq- tificates through to 2017.

Retail Trade Entertainment Nacu added that there are also opuity are heavily dependent on the indi14 10 vidual fund’s restrictions on ticket size portunities in banking, but the deals are and focus sector. On the local market, more complex because the central bank with only a handful of PE players, this has to decide whether to let a PE fund means that some sectors will inadver- become a shareholder in a lender.

“In recent years, there has been some tently be left out,” said Manda.

Utilities 15 Although the financial services sec- reluctance in this area. The main motitor is expected to host a number of im- vation of the central bank was probably Service 39 portant transactions, PE groups will that investment funds by definition Source: EMISPRO DealWatch service drive a limited number of deals, accord- have limited funds over time, and that ing to Pop of EY. He commented that there probably needs to be unlimited times. Statistically speaking, even at a based on market conditions have sectors such as business and profes- availability to fund banks at some point,” European level, companies owned by plagued the M&A market and brought sional services, consumer goods and said Nacu.

PE have done better during the crisis otherwise salvageable enterprises to the services, and real estate are expected to appear on investment radars. and maybe they were more attractive edge of the cliff,” Manda told BR. Local economy shaped by Axxess Capital Partners last year acBumbacea of PwC said, “Whilst no elections for an exit than the rest of the market,” commented the EI partner. Last year quired paints producer Deutek through sector seems a clear favorite for private Representatives of PE funds reckon the the fund sold its stake in Siveco, the Ro- its Emerging Europe Accession Fund equity, given that the relatively higher economy will grow by over 2 percent (EEAF) from PE group Advent Interna- economic growth experienced during this year, but any estimate has to take manian software company.

Nacu said the local portfolio had per- tional. Furthermore, the EEAF added a the second half of 2013 was not mir- into account the forthcoming elections. formed from “well to very good” in 2013. majority stake in Nextebank following a rored by similar growth in personal Romania is set to hold its ballot for the He added that retailer Profi had ex- deal with MKB and a EUR 5 million in- spending and consumption, one may European Parliament in May and presipanded aggressively, more than tripling vestment into Start Storage, a local expect business services and selected dential elections will follow in Novemits national network to over 200 stores provider of storage, outsourcing and industrial sectors to be favored to some ber. cloud solutions. extent over sectors driven by consumer in three years.

“The political instability currently unspending or highly dependent on con- folding and the uncertainty brought Construction material group Macon sumer finance.” has been back in the black for two years, How to attract PE about by abrupt changes to the fiscal “Expanding and gaining market share policy may yet again prove to be powerwhile Smartree registered constant Nacu of EI comments that a company growth. “We are satisfied with its evo- aiming to catch the eye of PE players may still be the driving factors behind ful deterrents for investors,” said Manda lution and we are on chart with the needs to have registered constant some portfolios’ bolt-on acquisitions, of Axxess Capital Partners. growth we targeted. We do not exclude growth in recent years, to be profitable even in sectors that haven't enjoyed imNacu of EI suggested that this year acquisitions for Smartree going forward,” and have strong management. In addi- pressive performances over the last few the government could focus on finding said Nacu. measures to stimulate not only domestion, it needs to be a market leader or years,” she added.

Renewable energy has been an at- tic consumption, but economic growth.

Horia Manda, managing partner at have the potential to become one, and Axxess Capital Partners, the investment to be active in a market that shows signs tractive sector for PE funds in the past He added that the situation in the Euro manager of three private equity funds, zone greatly influences investors’ sentisaid the companies in the portfolio regment regarding Romania, which is istered a “good performance last year”, heavily dependent on the bloc of naShare by Sector in Total Value of Deals in Romania (2013) adding that the overachievers were fitions, especially on exports. nancial services provider Patria Credit, Manda of Axxess Capital notes that Finance & toy retailer Noriel, security firm Bitdethe local economy relies on EU partOther 13.7% Insurance 9.9% fender and energy company SE-GES. ners largely for cash inflows from exMihai Pop, manager within the ports and investments, and banking transaction advisory services departactivity. ment at the professional services firm “Naturally, any worsening of the Euro Food & EY Romania, predicts that more zone situation sends ripples that, diBeverages 5.5% processes might start, but the number rectly or indirectly, have an adverse efWholesale & of exits will not necessarily rise, with fect on both the local economy and the Retail Trade some serving as preparation for the local PE market. Last, but not least, let’s 12.9% coming years. not forget that most of the financing According to Manda of Axxess Capithat local PE funds raise comes directly tal, new exits may come this year, but from institutions that operate in the the market is grappling with the unrealEuro zone. Fortunately, now, the Euro istic expectations of entrepreneurs zone distress seems to have somewhat Services 22.2% courted to sell their businesses to PE been brought under control and we do funds. not expect any major negative develop“We are hopeful that 2014 will bring a ments in the near future,” said Manda. narrower gap between investors’ valuThe EC last week tipped the Euro ations and entrepreneurs’ expectations. zone economy to gain 1.2 percent this In recent years, unfortunately, the reyear.

Utilities 35.9% luctance of entrepreneurs to accept a reSource: EMISPRO DealWatch service alistic evaluation of their companies ovidiu.posirca@business-review.ro Source: Third Emerging Europe: M&A Report co-authored by CMS and EMIS

www.business-review.eu Business Review | March 3 - 9, 2014

24 ONLINE VOTE

Best effort to support For the ninth annual Business Review Awards, we wanted to celebrate the events and individuals that have made great strides in promoting Romania’s image abroad. Nobody benefits more from the efforts of these nominees than the Romanians and expats living here, so it was fitting to let them decide who had achieved the most in 2013 by casting their votes on our website.

Courtesy of Enescu Festival

Mihai Constantinescu, general manager of Artexim, the organizer of the George Enescu Festival, with conductor Daniel Barenboim, outside concert venue Sala Palatului

∫ ANCA IONITA OANA VASILIU DIANA PETRESCU The George Enescu Music Festival “Queen Marie believed that life is a glorious celebration of music and song. A century later, the country’s capital city of Bucharest, once known as the Paris of the East, has lived up to the queen’s motto by staging the most ambitious classical music festival Romania has ever seen.” This is how the Boston Globe’s music editor wrote about the 21st edition of the George Enescu Festival.

One of the biggest music festivals in Eastern Europe, the event broke

record after record in 2013. It brought over 3,000 foreign artists to Bucharest and another nine cities in Romania: some 120,000 ticket-buying spectators (including 20,000 foreigners) enjoyed 150 concerts around the country. Furthermore, 22,000 tickets were snapped up within two hours of going on sale online.

Mihai Constantinescu, general manager of Artexim (the organizer of the Enescu Festival), whose managerial skills and talent over the past 23 years have put the event among the top five European classical music festivals (in competition with Salzburg, Aix-en-Provence and Bayreuth), says several factors have contributed to the international relevance of the festival: “First it was the idea to invite the most important artists of the moment to

perform in Romania and the request Netzer. The film premiered in compethey perform Enescu’s works, mostly tition at the 63rd Berlin International unknown outside our country. Sec- Film Festival where it won the Golden ondly, the idea to invite journalists to Bear, also claiming the Telia Film write about the festival, thus exposing Award at the 2013 Stockholm Internathem to Romanian culture, Romanian tional Film Festival. “A ferocious psyclassical music and the Romanian peo- chological drama” and a merciless ple and audiences. Last – but not least “examination of socio-political dynam– to bring together Romanian artists ics”, at the heart of the film was the and foreign ensembles, artists, orches- powerful performance of Luminita tras and composers. In this way we Gheorghiu, nominated for Best Actress opened up Romania; we showed we at the 26th European Film Awards. Achave an important culture which peo- claimed all over Europe as one of the ple did not have too much information best productions of the New Romanabout.” ian Cinema wave, the film also had a strong promotion campaign in the United States, and was Romania’s proChild’s Pose posal for Best Foreign Language Film (Pozitia Copilului) The most successful Romanian movie at the Oscars in 2014. Although it did released in 2013 was Child’s Pose (Pozi- not make the shortlist – despite the tia Copilului), directed by Calin Peter very good reviews it got on both sides

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ONLINE VOTE 25

Romania’s image of the Atlantic – the campaign, coordinated by producer Ada Solomon, made the film known to a larger American audience than usual. “If you missed the remarkable Child’s Pose during its one week at the Nuart in West Los Angeles the movie gods have given you a reprieve,” wrote Los Angeles Times film critic Kenneth Turan in the online edition on February 24, 2014. The movie is currently being screened around the world.

Solomon was given the European co-production award, the Prix Eurimages, during the European Film Awards ceremony in Berlin in December, to acknowledge “the decisive role of co-productions in the European film industry.”

Catalin Anchidin, the film’s communication director, says many foreigners wonder why Romania does not support or invest in culture and innovation. “I have the feeling that foreigners trust Romanians much more than we do. Furthermore, as we move beyond the communist period and standard Securitate questions, foreigners are much more up-to-date on Romanian fashion design, cinema, and artists in general; therefore most questions are focused on these topics,” said Anchidin.

“Why don’t you come over?” – Gandul, Webstyler and GMP campaign

Princess Marina Sturdza Since her return to her native country in the early ‘90s, Princess Marina Sturdza has made it one of her priorities to

Prince Charles Prince Charles made several visits to Romania in 2013, each time focusing the media’s attention on the country’s numerous assets. The heir to the British throne said in the third installment of the documentary Wild Carpathia expressed a desire to help the country preserve its rural cultural heritage. “These people have been through a lot, they have seen much suffering, destruction, and their lives

Courtesy of Child’s Pose

“Why don’t you come over?” was the Romanian media’s response to scare stories in the British tabloids suggesting that January 1 2014 would herald a Romanian and Bulgarian invasion of the UK once employment restrictions were lifted. Local company GMP Advertising and online daily Gandul.info came up with a campaign that, playing on how “awful” the UK is supposed to be, invited Brits to come to Romania, with tongue-in-cheek references to such assets as cheap beer. The campaign received coverage in over 100 news outlets, among them the BBC, Reuters, Washington Post and Huffington Post.

The BBC wrote, “A Romanian media campaign called ‘Why don't you come over?’ is poking fun at British anxiety about a possible influx of Romanian job-seekers next year”, while Buzzfeed, the online platform for marcomm professionals, commented that it was “a perfect response to negative comments about Romanian immigration by the British government”.

change the lives of Romania’s institutionalized children, a terrible legacy of the communist regime and one of the elements contributing to the overall negative perception of the country in the Western world. Patron of several international charities and organizations active also in Romania, such as Hope and Homes for Children, The Hospice of Hope and FARA, she has directly participated in their orchestrated efforts to actively transform the Romanian childcare system and legislation. She is a winner of the EU’s 2005 European Women of Achievement Humanitarian Award, the 2009 Avon Award for Humanitarian work in Romania, as well as Save The Children Romania’s 2010 special achievement award for her work in child protection.

“In 1989 Romania was faced with a tragedy, the likes of which nobody had accurately assessed earlier. More than 120,000 children were languishing in institutions, some in unspeakable conditions, all the grim results of Ceaucescu’s Kafka-esque social engineering policies,” says Sturdza.

“Few people knew of this dreadful situation, and Romanians discovered the situation at the same time as the rest of the Western world, when films of the institutions began being shown.

Romania can rightly say that miracles have been accomplished, with fewer than 8,000 children still institutionalized, all of them with far better prospects, and the accent now is on prevention of abandonment. All governments have made the fate of the children a priority for the country, working in tandem with many NGOs and agencies. Along the way, we became leaders in de-institutionalization, and we now represent standards of excellence in those domains,” she adds.

According to her, the most important element in a country’s image is “pride in one’s country and reflecting that pride at every level, individual, local and international. We are responsible for our own image, not that of other countries,” she stresses. In her opinion, the young people are the country’s “greatest asset”, and they should be “our greatest investment in its future”.

Director Calin Netzer with the Child’s Pose cast and producers on the red carpet at the Berlin Film Festival 2013, where the film won the Golden Bear award

have been destroyed. We owe it to find a path for a better future that they should preserve their culture, traditions and values,” said the Prince of Wales. He first came to Transylvania in 1998, when he was “totally overwhelmed by its unique beauty and its extraordinarily rich heritage”. He bought a property in the Saxon village of Viscri, near Sighisoara. Telegraph journalist Adrian Bridge accompanied him on one of his summer visits to Romania, in 2012. He wrote, “For the Prince of Wales, the region represented a dream come true: a living example of the possibility of a more harmonious relationship between man and nature; a community that, rather than destroying its traditions in the race to modernity, seemed to have preserved and adapted them. He de-

cided to add his voice to those calling for the protection of what is so special here and to lend it material substance by getting involved in a project that embraced the principles of sustainable tourism, and provided much-needed local employment.”

La Blouse Roumaine La Blouse Roumaine is the first online community dedicated to the “ia,” the traditional Romanian peasant shirt, founded by Andreea Diana Tanasescu.

In 2013, the community proposed June 24 – also the first day of the Sanziene holiday – be declared “International Day of Ia”. The event proved popular, and was celebrated by people wearing the famous blouse in over 50 countries on six continents, that posted their photos on the community’s Facebook page. La

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26 ONLINE VOTE

Princess Marina Sturdza speaking in her capacity as child protection patron

Prince Charles appreciates Romania’s traditional ways

port for his association, with the latest assistance coming at the Nuremberg BioFach trade fair, where Romania was named the Year’s Country of Trade, impressing participants, German officials, EU officials and organizers.

Magiunul Topoloveni

The GMP-Gandul-Webstyler campaign

This brand of traditional Romanian jam had an excellent year, entering the Finnish, Swiss and Japanese markets thanks to a European project rolled out

by Sonimpex with partners in Greece and Italy. Company officials told BR that export sales are mostly through organized fairs, but they did not provide concrete numbers.

Bibiana Stanciulov, general director of Sonimpex Topoloveni, says that Ro-

mania's image is often distorted for various reasons. “It bothers me that foreigners sometimes seem surprised that I manage to get excellent quality products. I was surprised by the reaction of a German who told me that if he were to sell any of my products, he couldn’t sell anything labeled ‘made in Germany’, because of our outstanding quality,” Stanciulov told BR.

273 Reasons to Visit Romania A Facebook page promoting the beautiful parts of Romania managed to reach over 400,000 fans in 2013, thanks to the efforts of the project’s creator, Magda Savuica, who periodically receives offers from public institutions to promote their campaigns, because, she says, “We

Blouse Roumaine is the name of a 1940 painting by Henri Matisse , one of a series of portraits dedicated to Romanian ie. Matisse was fascinated by the blouse, which he discovered through his friendship with the Romanian painter Theodor Pallady. La Blouse Roumaine (paper oil) depicts a ie-clad peasant woman, wearing plaits and with her hands in her lap.

Bio Romania Association

Photo: Beety Radoi

A local non-profit, non-governmental, apolitical and independent legal entity, Bio Romania Association advocates for the sustainable development of agriculture and rural areas, as well as education, information and consumer awareness of the benefits of organic farming for both human and environmental health, by promoting the consumption of certified organic foods. On the short term, the association is campaigning to create favorable economic conditions for Romania’s organic farmers, replicating the help given to organic farmers by other EU states. Marian Cioceanu, president of the association, says that the Ministry of Agriculture and Rural Development provides great sup-

The 273.ro Facebook page shares photos depicting Romania’s landscapes with a worldwide audience

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ONLINE VOTE 27

Courtesy of Making Waves

Making Waves Romanian Film Festival in New York

are close to people and trustworthy.”

Project 273 started from a personal passion for lesser known places in Romania. Over the years, Savuica wrote in a notebook the different places that she wanted to see in Romania, most of them discovered from novels, her travels or friends’ stories. She later uploaded an album on Facebook, sharing her suggestions with friends who enjoy travel. BR asked Savuica what the country represents to her. “Romania is the place where I was ‘destined’ to be born.

Gradually, growing up, I found things in the country that seemed like they had been a part of me for so long: traditions, the rural life, the history, beautiful people and their stories, the beautiful places you can see everywhere, the mountains. Every place was a part of me waiting to be discovered.”

Making Waves – New Romanian Cinema

logical boost, while neoliberal influences on the market economies in European states determined the growth of the ‘country branding’ concept, typical for Anglo-Saxon societies in particular.

Romania, like other Latin and South East European countries, has struggled sometimes with this concept, as it was formally and wrongly translated to the region. The solution is to give content to a branding strategy, not just to create and implement image campaigns that do not match the real potential of the country, or match it in a superficial and old-fashioned, stereotyped and banal way.” Asked by BR if the public institutions are of any help in promoting her festival, Suteu says not yet. “We have had a few interviews on the Romanian Public Radio, and we’ve also had support from the UN Embassy in New York in hosting three of our guests”.

Making Waves is a festival showcasing eMAG Foundation New Romanian Cinema organized by Spotting the paradox in the current Rothe Film Society of Lincoln Center, manian educational system – many Jacob Burns Film Center and Romanian good teachers and brilliant students, Film Initiative, in collaboration with the enrolled in a system that badly manages Transylvania International Film Festival. talents and fails to present them as valid The festival aims to provide a panorama examples for future generations, eMAG of contemporary Romanian filmmaking Foundation supports education and in the US, as well as introduce American high-achieving Romanian students in audiences to classic landmark films international contests. In 2013, Romania through powerful and inventive pro- was fifth internationally and first gramming. It is the only comprehensive among the European countries at the US festival dedicated to showcasing and International Physics Olympiad. Gold celebrating the best of Romanian con- medalist are not a rarity – it happens temporary cinema as well as rarely seen every year, without exception, yet Roclassics. Well received by New York crit- mania is still struggling to prove that a ics and filmgoers, the festival has 17-year-old student who won a gold screened local productions that have medal at the International Physics been lauded as “some of the most vi- Olympiad is at least as worthy of attenbrant and engaging international film- tion as a football player. “From our making in recent years – garnering ten point of view, Romania’s most valuable major awards at Cannes, Berlin and resources are its brains,” says Tudor other festivals and spawning a move- Vlad, president of eMAG Foundation. ment referred to as the Romanian New “One of our (very) long-term objectives is Wave” (Indie Wire). to develop a strategy to encourage the Corina Suteu, co-founder of the Ro- brightest young people to stay in the manian Film Initiative, president of the country and teach others. That would Making Waves Festival, says among the help raise the overall level of education.” important elements for a country’s image is “the power the media commu- anca.ionita@business-review.ro nication has developed in the last 20 oana.vasiliu@business-review.ro years under the influence of the techno- diana.petrescu@business-review.ro

www.business-review.eu Business Review | March 3 - 9, 2014

28 CITY FILM REVIEW

Like Father, Like Son (Soshite Chichi ni Naru) DEBBIE STOWE Director: Hirokazu Koreeda Starring: Masaharu Fukuyama, Machiko Ono, Yoko Maki, Lily Franky, Jun Kunimura, Kirin KikiI, Isao Natsuyagi, Jun Fubuki, Megumi Morisaki On at: Elvira Popescu, Noul Cinematograf al Regizorului Roman The Nonomiyas seem like the perfect Tokyo family. Dad Ryota (Masaharu Fukuyama) is a successful and important architect. Mum Midori (Machiko Ono) good-humoredly chops vegetables to make nourishing soups in their swanky high-rise show home. And six-year-old Keita (Keita Ninomiya) diligently practices the piano, lies dutifully to the school inspectors about idyllic family camping trips that never actually happened, and is cute as a button.

Problem is, Keita is no Nonomiya.

A routine blood test during school en-

rolment procedures unearths a maternity ward mix-up, which saw two newborns handed over to the wrong parents, meaning that the Nonomiyas’ biological son has spent the last six years across town being raised by another set of parents, while they in turn have been raising that couple’s boy.

And the two families are by no means alike in dignity. While the middle-class Nonomiyas are genteel, disciplined and aspirational, the working-class Saikis are a rambunctious bunch, and young Ryusei (Hwang Shogen) has had a roughand-tumble childhood above dad Yudai’s (Lily Franky) scruffy repair shop.

Where do they all go from here?

Does six years of love and nurturing count for more than accident of birth?

Or is blood always thicker than water?

Is it time spent together, instruction and example that shape a child’s character, or will biology have the final

Who’s the daddy? Masaharu Fukuyama in a touching swapped-at-birth drama

say? The stage is set for an involving and moving drama, one where it is all too easy to empathize with the characters.

With the exception of a subplot that explains the genesis of the baby swap, the story does not spring any major surprises. Instead, it proceeds to deal sensitively, calmly and thoughtfully with material that could easily have been milked to melodrama in the hands of a lesser director.

But Hirokazu Koreeda allows the tale to speak for itself, and even derives some humor from the painful situation: we feel bourgeois Ryota’s horror when his boisterous birth son fumbles with his chopsticks and, immersed in a lowbrow computer game, shouts “Oh my God!” in English.

Class clearly interests the director, but as he juxtaposes the two sets of parents, he doesn’t resort to easy stereotypes. Working-class values are neither demonized nor romanticized: while unkempt and unpunctual Yudai initially seems more interested in the potential for squeezing financial compensation out of the hospital than the likely trauma for the boys, he is later shown to be a warm and involved father. Meanwhile, salaryman Ryota’s discipline and drive, while securing his family a very comfortable existence, have made him a somewhat distant parent.

This is brought home in touching scenes showing the families on an

outing together, during which the two fathers discuss kite flying (previously also used as a symbol of paternal affection and bonding in classic 1964 British musical Mary Poppins, when a hitherto staid and serious father learns the value of having fun with his kids). Ryota has had neither the time nor the inclination to fly a kite with his son, whereas the jolly family excursion that Keita had to invent to impress the school officials is a regular event for the Saiki brood.

The other main theme is the nature/nurture debate. At six, the boys are old enough to have absorbed their families’ values. As the parents get to know their respective biological sons, scenes of quiet, well behaved little Keita bewildered by the noisy horseplay chez Saiki are some of the film’s most touching, while Ryota and Midori struggle as the peace of their plush apartment is shattered by the cuckoo in their nest.

Koreeda is probing what it means to be a father, and if the film has one flaw, it is that the respective mothers – for whom the shock of the switch would arguably be worse, given the psychological impact of labor – are not really developed as characters.

Perhaps the director will remedy this in another film. If his future efforts are as assured, poignant and discerning as Like Father, Like Son, they will be a pleasure. debbie.stowe@business-review.ro

www.business-review.eu Business Review | March 3 - 9, 2014

CALENDAR 29

Cultural highlights Spring-Summer artist of all time, will perform for the first time in Romania. The winner of two Grammy awards and three Latin Grammy prizes, he has sold millions of albums worldwide. Anthony released his first album, When the Night Is Over, in 1991, while his 1995 album, featuring songs like Te Conozco Bien, Hasta Ayer, and Nadie Como Ella, was nominated for a Grammy.

∫ OANA VASILIU March 14 Lord of Dance Performance: The Irish troupe will be accompanied by their iconic dancer and choreographer Michael Flatley, the creator of the phenomenon, in a brand new show with fantasy characters, where good and bad will be interpreted through dance steps.

30 May – 8 June Transylvania International Film Festival

March 17-23 One World Romania Film festival: Now on its sixth edition, the only documentary festival in Bucharest dedicated to human rights will showcase 50 films, as well as ten linked events and discussions with filmmakers and some of the subjects of the works. Documentaries of local interest include Where are You, Bucharest? and Romanian Autumn, while topical films such as Putin’s Games will get a timely screening.

March 19 Richard Clayderman Concert: The veteran French pianist, who has sold an astonishing number of records, will return to Romania for another show. Born in Paris in 1953, Clayderman was working as a session musician in France before successfully auditioning before French producer Olivier Toussaint to record the piano piece Ballade pour Adeline, composed

by Toussaint’s colleague Paul de Senneville. The gentle ballad was an international hit and started Clayderman’s meteoric career as a solo artist.

Big Time: Peter Gabriel will perform his first concert in Bucharest

April 3-7 Next Film Festival Film festival: Each year, the organizers present short and medium-length films made by up-and-coming movie directors and sound designers from around the world. A maximum of 30 films are selected to take part in the festival and compete for the NexT awards. Their creators are invited to Bucharest for the whole festival, with NexT serving as a meeting place for those who use film to express themselves.

April 19-27 BRD Nastase-Tiriac Trophy

March 25 Hiromi Performance: Pianist and composer Hiromi Uehara, whose passionate and incendiary keyboard work has been a shining light on the jazz landscape since her 2003 debut, believes that the voice that never speaks can sometimes be the most powerful of all. Her newest release, a nine-song trio recording simply titled Voice, expresses a range of human emotions without the aid of a single lyric. A Bucharest audience will be introduced to it this spring.

March 26 – April 2 Bucharest International Film Festival Film Festival: This festival brings audiences both independent, small-budget productions and more prominent films awarded at major international festivals. It will open with La Grande Bellezza, which premiered at the 2013 Cannes Film Festival where it was screened in competition for the Palme d'Or.

and fans can have a say during the 2014 Fans Rule World Tour.

April 26-27 Dreamhack 2014 eSport tournament: DreamHack aims to bring together games, high-speed internet, eSports, international tournaments, enthusiasm, communication, digital culture and entertainment, in a hypnotizing and unique annual festival.

Concert: The English singer and songwriter, who became famous as the lead vocalist of the progressive rock band Genesis, is playing Romania for the first time. Fans will hear live renditions of such hits as Sledgehammer, Big Time, and Don’t Give Up.

Concert: American singer Marc Anthony, the best-selling tropical salsa

April 21 Harlem Globetrotters Sports: Last year, iconic basketball team the Harlem Globetrotters, whose history dates back 88 years, took the unusual step of letting fans vote on new rules to be used in games. The process is being repeated this year,

June 6-15 Sibiu International Theatre Festival

May 8 Peter Gabriel

May 18 Marc Antony

Tennis tournament: The BNR Arenas will play host to a program of outdoor tennis matches and exhibition events staged in a relaxing atmosphere. During the breaks between matches, spectators can enjoy a variety of options offered by the Tennis Village: coffee shops, entertainment areas and dedicated events.

Film festival: Romania’s highest-profile film festival aims to showcase flagship works from contemporary European cinema and bring icons of film before local audiences. The main winners at major festivals in Berlin, Venice, Karlovy Vary, Sarajevo, San Sebastian and Tokyo will have their local premieres at TIFF 2014, with the selection made by artistic director Mihai Chirilov.

Theatre festival: The annual event, hosting the world's prime performing arts, is the third largest in the world in terms of audience, which reaches around 60,000 a day, and the number of countries involved. It is also the third biggest worldwide thanks to its 350 events and 60 venues, which is supported by both national (Nicolae Manolescu, Marina Constantinescu, Silviu Purcarete) and international (Kenneth Campbell, Noel Witts) art lovers. So far, the line-up of the festival has yet to be announced.

June 25-29 Le Grand Prix de l’Opéra Performance: Under the umbrella of the World Federation of International Music Competitions, the contest is open to young singers from Romania and abroad. Competitors have the chance to win awards of EUR 12,000, record and performance contracts, as well as leading roles in BNO productions. oana.vasiliu@business-review.ro

www.business-review.eu Business Review | March 3 - 9, 2014¡

30 RESTAURANT

Embrace your Irishness Break out a beer, whip out some whiskey or get your Guinness on - St. Patrick’s Day is coming! Local revelers often like to mark the event in Irish-style surroundings, so BR hit the town in search of the best places to find the craic on the day that celebrates all things Irish. Sham-rock on! finish reading).

If St. Patrick’s is too loud, too bright, and too busy… you may like to try James Joyce Pub.

∫ DIANA PETRESCU One of the best ways to say “thank you” to Ireland for Oscar Wilde, U2, Pierce Brosnan and everything else that you are grateful for is to celebrate St. Patrick’s Day in an Irish pub.

It is universally recognized as the day when the world stops and admits that “those Irish, they are pretty fun”, a day to celebrate Irish culture and customs. On March 17 famous landmarks are “dressed” in green, the biggest cities in the world (including Bucharest) organize special parades and people flock to Irish pubs for a pint of Guinness.

While the Romanian capital has its fair share of pubs, it is not exactly “overflowing” in this department. Irish pubs are typically pricier than the standard Bucharest local, which may be part of the reason why so many go out of business.

Business Review has put up a list of the best Irish pubs Romanian capital has to offer:

James Joyce Pub Walter Maracineanu 1-3; 021 311 4177 Located near Cismigiu, the location has frequently changed names and owners over time, but Joyce’s seems to be the one that has stuck. It is a dark pub and we are not referring to the atmosphere.

It is literally dark, given the small windows, brick walls and furniture in dark-brown tones. James Joyce Pub has the Irish Embassy seal of approval, having been used as a venue for the Bloomsday Festival: an event dedicated to Leopold Bloom, the main character of Joyce’s Ulysses.

Paddy power: revelers enjoy the Irish atmosphere

major international hotel and several The Dubliner company headquarters, business Nicolae Titulescu 18; 021 222 9473 lunches are, pun intended, The Harp’s A true veteran of the pub scene, The “bread and butter”. It has two floors Dubliner is located near Piata Victo- and no non-smoking section, but the riei and stands out because of its cov- pub is well ventilated so you will not ered terrace (which has always been feel the looming threat of cigarette there). At one point, The Dubliner and smoke. The menu contains Irish speThe Harp had the same owners; how- cialties (meat pies, halibut steak), ever they couldn’t be more different. piri-piri chicken, pizza, sandwiches, The Dubliner is less “tidy” than The apple pie and carrot cake. A bit pricier Harp, the atmosphere gets pretty in- than The Dubliner, a pint of Guinness tense during football matches and the (560 ml) is RON 16 and cocktails vary between RON 18 and 26. prices are certainly lower.

The Harp Bibescu Voda 1; 0735 554 455 Located near Hotel Horoscope, The Harp recently changed owners and has undergone a renovation. The new design reflects the pub’s “corporate” clientele. Given its proximity to a

St. Patrick Irish Pub and Restaurant Smardan 25; 021 313 0336 St. Patrick’s is located in the heart of the historical center on Smardan Street. It prides itself on being the only pub in Romania built to the original Victorian Irish pub concept, from

FOUNDING EDITOR Bill Avery PUBLISHER Anca Ionita EDITOR-IN-CHIEF Simona Fodor JOURNALISTS Otilia Haraga - senior journalist, Simona Bazavan, Ovidiu Posirca, Oana Vasiliu COPY EDITOR Debbie Stowe PHOTO EDITOR: Mihai Constantineanu

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design to services and atmosphere.

This boast is justified, given that St. Patrick won the Guinness Award for Best Pub at the 2013 Food & Bar Awards.

A pint of Guinness or Kilkenny will set you back RON 16. A pitcher of the local St. Patrick’s Beer (1,500 ml) costs RON 27, while sandwiches are priced between RON 21 and 31 and most of the pizzas over RON 30.

However, it’s the only place we’ve seen that offers deep-fried chocolate bars for dessert (a Scottish specialty).

Given its ultra-central location, it is almost always full with an assortment of foreign and local patrons.

While it may be the perfect spot to celebrate St. Patrick’s Day, we recommend you get on the phone and make a reservation right now (or after you

EXECUTIVE DIRECTOR George Moise SALES & EVENTS DIRECTOR Oana Molodoi SALES & EVENTS Sales managers: Ana-Maria Nedelcu, Oana Albu, Raluca Comanescu Sales executives: Ana Maria Andrei MARKETING Ana-Maria Stanca, Catalina Costiuc, Iulia Mizgan PRODUCTION Dan Mitroi DISTRIBUTION Eugen Musat

Explorer’s Pub Franceza, 9; 0735 190 131 One of the more recent additions to Bucharest’s pub scene is Explorer’s, opened in November 2013 in the historical center. Most Irish pubs in Bucharest are happy to design their theme around the generally accepted idea of “Irishness”: an abundance of posters with beer commercials, various knick-knacks posing as antiques and the ever-present “shamrock”. Explorer’s goes that extra step, plastering maps of former British colonies all over the walls.

The menu is a mish-mash of traditional pub food (Irish pie at RON 26, pizzas from RON 15-30) and local cuisine (plateau of traditional Romanian products at RON 65).

The pub is spacious and you can bring your friends to watch a Champions League game on one of the many plasma-screen TVs, or choose a booth with a bit more privacy for a romantic date. diana.petrescu@business-review.ro

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