THE STATE EUROBONDS ISSUE WAS FIVE TIMES OVER SUBSCRIBED; SEE PAGE 9 ENERGY
MONEY
The Bucharest Stock Exchange is
Local lenders have seen falling prof-
Catalin Mahu, owner of Trotter Restau-
preparing to become a player on the
itability ever since 2008, and 2010 will
rant, is aiming to generate EUR 7.5 mil-
greenhouse gas emissions market, but
be no different, says Cezar Furtuna, au-
lion from the three restaurant and cof-
procedures are not yet in place
dit partner at KPMG
fee shop chains in his portfolio
See pages 12-13
ENTREPRENEUR
See pages 14-15
See page 20
www.business-review.ro
BUSINESS REVIEW ROMANIA’S PREMIERE BUSINESS WEEKLY
MARCH 15 - 21, 2010 / VOLUME 14, NUMBER 8
SWEDISH SWOOP
Swedish furniture giant IKEA Group has bought the franchising rights and operations of the local IKEA business from Moaro Trading, in a bid for South Eastern European expansion. The move makes Romania one of the many countries where the retailer and producer runs stores directly See page 4
IN TOUCH PHOTO OF THE WEEK
Week in NUMBERS 23.6 Romania's external debt has reached EUR 23.6 billion, having increased three fold in the last five years
6.9 Romanian industrial output went up by 6.9 percent in January this year on the same month of last year, according to data from the National Institute of Statistics
Bucharest subway workers are set to walk out on March 18. Trains will stop from 4am to 4pm, as Metrorex employees strike for a pay rise and better working conditions. Meanwhile, the state has taken out a Japanese loan to build an underground link to the airport, with another line being tendered
IN TOUCH Online onslaught I tend to agree with the contributors to last week’s e-training feature (E-training gains momentum on coaching market, issue 8) that online tuition will not supplant face-to-face learning. As a trainer, I know that a lot of the communication with my clients is non-verbal: facial expressions, tone of voice etc. Learning without the extra layer of signals that comes from being on the spot is often a dry affair, and the best remembered topics and themes are those that made a splash in the classroom. In any case, we in Europe had better hope that this is the case. Online tuition – for example tutors for schoolchildren – is already big business in markets like the US, where intelligent, fluent people from low-cost-ofliving countries like India are provid-
ing budget-rate services over the internet. Can we compete? A Lupescu, Bucharest
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Three Romanian businessmen were included in Forbes' billionaires list: Dinu Patriciu, Ioan Niculae and Ion Tiriac
B USINESS R EVIEW MARCH 15 - 21, 2010 / VOLUME 14, NUMBER 9
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3
NEWS
BRIEFS TRADE DEFICIT DROPS IN JANUARY é Romania’s trade deficit fell by 38.4 percent in January to EUR 426.8 million, according to the National Institute of Statistics. This was caused by a growth in imports, for the first time since November 2008, of 4.4 percent, and by a 19.8 percent increase in exports. The last annual import rise was registered in October 2008 and amounted to 3.6 percent in euro. ANNUAL INFLATION DECLINES, AFTER THREE MONTHS OF CLIMBS é Annual inflation fell, for the first time after three consecutive months of rises, to 4.49 percent, compared with 5.2 percent in January this year. According to the National Institute of Statistics, the decline came as a result of a lower hike in product prices in February than in previous months. Although the overall impression is that prices dropped last month, on certain segments they actually increased. The most significant price rises in January compared with December last year were energy at 1.83 percent, vegetables (1.69 percent) and books and newspapers (1.35 percent). Urban transportation costs also rose by 1.39 percent. MEDLIFE PUTS EUR 500,000 INTO NEW UNIT é Private medical clinic operator MedLife has invested EUR 500,000 in a gastroenterology unit in MedLife Favorit clinic, the company has announced. MedLife expects to have 6,000 patients for the unit each year. The new unit follows the opening of similar ones for psychiatry, maternal medicine, including an in-vitro fertilization department, and a medical recovery unit. MedLife was set up in 1996. It currently runs four hyperclinics in Bucharest and across the country, five laboratories and medical centers in Cluj-Napoca, Arad, Brasov, Ploiesti and Navodari. It also owns the private Life Memorial Hospital, a EUR 12 million investment. 4
IKEA Group buys local franchise from group of investors in SEE expansion bid Swedish retailer and furniture producer IKEA Group has acquired its local franchise from a group of investors, the company has announced. The local franchise has been running an IKEA store for the last three years. It was held by Moaro Trading, which has sold the store’s operating rights and franchise. Moaro Trading had obtained the franchise rights from Inter IKEA Systems BV, the global IKEA franchiser. The acquisition was in line with IKEA Group’s future expansion plans in South Eastern Europe. The group includes all IKEA operations: the Swedwood industrial group, distribution and warehousing divisions and the companies that own stores in countries around the globe. IKEA has 301 shops in 37 countries, of which 268
IKEA has over 300 stores around the world
belong to the IKEA Group, the franchise holder. The remaining stores are owned and run by other franchisees.
EBRD criticizes Romania for ‘imaginary’ crisis stimulus package
Romania has pledged EUR 13 billion in stimuli
The stimulus the Romanian government intended to revive the country’s economy “has been more imaginary than real,” according to a report from the European Bank for Reconstruction and Development (EBRD). “Take the example of Romania, where the government announced in February 2009 a EUR 13 billion stimulus package to help counteract the worst effects of the crisis. The idea was to earmark most of it (more than EUR 10 billion) for infrastructure projects. So far, the ‘stimulus’ has been more imaginary than real; few projects have got off the ground and the effect on economic growth has been negligible,” said Peter Sanfey of the EBRD. Responding on behalf of the Romanian authorities, economy minister Adriean Videanu said that the EBRD did not know the realities of the Romanian
economy at close hand. He mentioned the expected reinvigoration of the local economy this year, after the economic slowdown declined in the second half of last year. Meanwhile, other countries have tried tax breaks to stimulate business. Serbia launched a package in February 2009 which included investment loans at subsidized rates to businesses, as well as consumer loans for the purchase of Serbian goods. In a similar vein, the FYR Macedonian and Montenegrin governments have tried to reduce the tax burden by selective cuts for businesses and households, while in Bosnia and Herzegovina, a targeted program for the less well-off involved the exemption of certain essential goods from VAT. All of these measures have brought some relief here and there, but they cannot be said to constitute a coherent anti-crisis approach, wrote the EBRD. “Those countries that have IMF programs – Bosnia and Herzegovina, Romania and Serbia – have found the Fund surprisingly lenient, compared with its traditional approach, in accepting relatively substantial government deficits last year, and, in the case of Romania and Serbia, in agreeing to an upward revision of the deficit target for 2009 once the full extent of the economic downturn became clear,” the EBRD representative added. Corina Saceanu
Last year the group posted a turnover of EUR 22.7 billion worldwide and had a 301-store chain across the world. All the furniture shops operate under a franchise from Inter IKEA Systems BV, according to the group. Moaro Trading, which opened the first IKEA store in Romania in 2007 after a EUR 10 million investment, was controlled by Dutch consortia Engma, Turkmall and Inter IKEA Systems. The local media named Romanian investor Gabriel Popoviciu as main investor in the Swedish furniture firm’s business in Romania. Popoviciu has invested in the Baneasa real estate project in north Bucharest, which includes the IKEA store in its retail area. Corina Saceanu
Fabryo Corporation posts 20 percent market share on retail segment Fabryo Corporation, the biggest local manufacturer of ornamental polishes and colors, posted a 20.3 percent market share on the retail segment last year, up from 14.7 percent in 2008, according to MEMRB studies. The firm also registered an increase of 4 percent in its net sales of ornamental products. Fabryo Corporation produces exclusively for the local market and does not manufacture private labels for other companies. The company’s total investments last year came to over EUR 1 million. Marketing and promoting programs on all sales channels were two of the areas of investment. It also put into practice an efficiency program to increase its productivity and profitability, dropping many non-core products. Its portfolio optimization caused an assumed fall in total turnover of about 7 percent in 2009, but boosted sales of core products, operational and net profit. “We have projects underway to prepare the market for the season: we will have installed over 150 pieces of equipment by end-March. We will also launch new products and investments of over EUR 1 million in promoting our products and brands. Our main objective is to increase our market share and profitability, with the minimum target being a 24 percent market share by end-2010,” said Aliz Kosza, Fabryo’s executive GM. Anda Dragan BUSINESS REVIEW / March 15 - 21, 2010
NEWS
CMU opens Bacau clinic after Siveco Romania turnover falls to EUR 49 million in 2009 EUR 1 million takeover
CMU posted a 72 percent rise in 2009 turnover
Private medical care provider Centrul Medical Unirea (CMU) has recently opened the Center for Medical Investigation Bacau, its seventh clinic outside Bucharest. The facility required a EUR 1 million investment which was made in December last year through the acquisition of a minority package in CIM Bacau, with which CMU had been collab-
BUSINESS REVIEW / March 15 - 21, 2010
orating for several years before the deal. Investment fund Advent International recently bought an 80 percent stake in CMU, in a deal estimated at around EUR 40 million. This was the largest transaction involving medical services this year. Investment fund 3TS Capital Partners, which was previously the second largest shareholder in the firm, along with the company founder Wargha Enayati, exited from the deal. 3TS used to own 39 percent of the shares in CMU, with Enayati holding the rest. The CMU founder has thus ceded his major shareholder position, with Advent owning the majority stake in CMU. Enayati now holds 20 percent of the firm he set up. Last year, CMU posted a 72 percent increase in turnover, to almost EUR 16.5 million. The company’s biggest investment was the EUR 5.5 million it poured into the Regina Maria maternity hospital. Corina Saceanu
Siveco Romania posted a turnover of EUR 49 million in 2009 using International Financial Reporting Standards (IFRS), said company officials. The figure compares with the EUR 66.5 million it posted in 2008. While industry insiders say that 2008 was a year of exceptional growth for the software industry in Romania – both compared to previous years and for the region – in 2009 there were profound economic mutations globally which sent it into decline, according to the company’s statement. The firm estimates a growth of 25 percent in revenues this year which will come from the export of solutions and know-how in the implementation of eLearning, eAgriculture, eCustoms and eHealth solutions as well as the consolidation of its position as a supplier of IT services for institutions in the European Union. Siveco Romania has a share of 21.2 percent on the local market of EAS (Enterprise Application Soft-
ware) solutions. The company also has 8.9 percent of the local market of IT services, according to the most recent study by International Data Corp (IDC). According to BloomBiz, Magyar Telekom is interested in taking over the Romanian outfit with negotiations currently in progress. The company did not confirm the report. The Romanian software firm is owned by Siveco Netherlanden (with 42.2 percent of shares), Intel Capital Corporation & Enterprise Investors (32.5 percent) and its own management (25.3 percent). Recently, company officials announced that it would become the main supplier of information services to the Ministry of National Education in Morocco. Within the Emergency Program for Reform, Siveco will implement an integrated IT system based on the AeL solution over the next three years, with the possibility of furthering this collaboration for the next ten years. Otilia Haraga
5
NEWS
BRIEFS GARRIGUES SPAIN ADVISES CAIXA CATALUNYA ON SALE OF INSURANCE BUSINESS TO MAPFRE é Garrigues Spain has advised Caixa Catalunya, the fifth largest savings bank in Spain by volume of assets, on the EUR 556.8 million sale of half of its insurance business to leading Spanish insurer, Mapfre. Through the deal, which was completed on March 5, Caixa Catalunya and Mapfre will jointly develop the savings bank’s solid insurance and pension business. More specifically, Mapfre will acquire 50 percent of Caixa Catalunya’s subsidiaries that offer insurance services throughout Iberia. ROMANIAN LEASING MARKET PLUMMETS BY 72 PERCENT LAST YEAR é The Romanian leasing market plunged by 72 percent last year from 2008, to EUR 1.33 billion, as a result of the decline in the automotive market, announced the Financial Companies Association in Romania (ALB). The evolution of the leasing market is closely tied to the development of the Romanian economy as a whole, which shrank by more than 7 percent last year from 2008. ROMANIAN SUBWAY UNION TO RESUME STRIKE ON MARCH 18 é The Bucharest subway union has announced that metro workers will go out on strike again on March 18. Subway trains will not run between 4 am and 4 pm. Normal service will resume from 4 pm to 11 pm, as the law requires subway staff to operate a third of normal activity during a general strike. Subway employees walked out last year, demanding a pay rise of 20 percent and a new collective work contract. They were forced to go back to work when a Bucharest court ruled the action illegal, a ruling which has now been overturned. Ioan Radoi, president of the subway union, said the workers want a pay rise of 3.7 percent and better working conditions. 6
EU releases additional EUR 1 billion to Romania
Turkish firms want EUR 8 bln in bilateral trade by 2012 Turkish companies active in Romania expect to increase bilateral trade by 20 percent next year, according to data from the Association of Turkish Investors in Romania (TIAD). Trade between the two countries reached EUR 4 billion last year, down 41 percent on 2008. The sum was equally divided between imports and exports, but the drop in exports was 34 percent, while imports fell 47 percent on 2008. After a difficult 2009, total Turkish investment in Romania reached EUR 3 billion, according to Omer Susli, head of TIAD. Trade between the two countries is expected to reach EUR 8 billion in 2012. “For this year we plan to resuscitate trade between Romania and Turkey, and we hope for an increase of 20 percent. Turkey took firm anti-crisis measures, and the economic situation is stable now. Turkish capital is interested in Romania, which will become more visible in the next period,” said Susli. Corina Saceanu
The European Union has disbursed EUR 1 billion for Romania in a second tranche of the EUR 5 billion package of financial assistance agreed upon in 2009 for balance-ofpayments support. “I’m happy to say Romania has fulfilled the conditions to receive the second tranche of the EU loan. The financial support granted by the European Union, the IMF and other international financial institutions has helped Romania overcome the toughest period of the economic and financial crisis,” said Olli Rehn, the EU Commissioner for Monetary and Economic Affairs. He added that the progress made regarding fiscal consolidation needed to be accompanies by structural reforms, including the adoption and implementation of the law regarding fiscal responsibility and the revised pension legislation. Another two EU countries are also benefiting from EU financial assistance to support their balance of payments in the context of the unfolding financial crisis. In November 2008, the Council agreed to a Commission proposal for EUR 6.5 billion in aid for Hungary. In Janu-
ary last year a EUR 3.1 billion package was approved for Latvia. In May, the overall ceiling for balanceof-payments support was doubled to EUR 50 billion. EU financial assistance is intended to help countries withstand shortterm liquidity problems, restore investor confidence and correct large imbalances in their economies. In return, recipient countries must commit to carrying out reforms to correct public deficits, boost competitiveness and improve financial supervision. From 20-27 January, a joint Commission, IMF and World Bank mission visited Bucharest to assess Romanian compliance with the policy conditions attached to the EU Balance of Payments Program. The mission concluded that Romania had met most of these policy conditions. Romania has achieved the cash fiscal deficit target for 2009 (7.3 percent of GDP), adopted a 2010 budget in line with the agreed deficit target (5.9 percent), introduced structural reforms and strengthened financial sector supervision. ■
Popovici Nitu & Associates merges with local firm, homes in on litigations
Pubs ‘the main driving force for imported beer brands,’ says URBB
Romanian law firm Popovici Nitu & Associates has merged with another local legal business, Danescu & Associates, the firm has announced. Following the merger, which will be effective from the beginning of April, a 20-lawyer litigation division will be created within Popovici Nitu & Associates. Corin Danescu, founder of Danescu & Associates, will become senior associate with Popovici Nitu & Associates and will coordinate, along with Ciprian Dontu, the litigation department. The firm will have 70 layers after the merger, of whom 10 will be partners. Popovici Nitu & Associates posted a EUR 7 million turnover in 2009 and expects a 10 to 15 percent operational increase this year, according to the company. Corina Saceanu
Cheers: pubs are popular for imported beer and upmarket brands
Imported beer brands continue to attract consumers both through high brand loyalty and the opening of a large number of pubs in 2009, in Bucharest and other large cities around Romania, said United Romanian Breweries Bereprod representatives. According to them, almost 35 such locations began trading last year. They estimate that the number of pubs nationwide will increase by 75 percent this year. Pubs are popular with
drinkers for the imported beer brands they stock and for their international premium and super-premium brands. “Although the consumption of Guinness beer remained at the same level in 2009 as 2008, it increased by 35 percent in pub locations. This shows that despite the current difficult economic conditions, Romanians still enjoy drinking a beer in a pub and remained loyal to the traditional Irish beer, which is specific to this kind of location,” said Doron Zilberstein, marketing vice-president at URBB. He added that although onpremise beer consumption fell last year, about 70 percent of the sales registered for imported beers came from such locations. “We intend to increase on-premise Guinness beer consumption by more than 60 percent this year, so we are doing everything necessary to be present in each new pub, especially through the Guinness brand,” said Zilberstein. Anda Dragan BUSINESS REVIEW / March 15 - 21, 2010
NEWS
Ministry of Communications to install 300 new hotspots in public areas
Internet on demand is becoming more common
Eurobank EFG sees net income fall 45 percent in 2009
Banks have been hit hard by the crisis
Eurobank EFG Group posted a net income of EUR 362 million in 2009, a decrease of 45 percent on 2008. Its CAD ratio strengthened by 2.3 percent to 12.7 percent. Net interest income receded slightly by 1.8 percent year on year and amounted to EUR 2.3 billion in 2009, a result of increased funding costs. Net interest income grew steadily after Q1 2009 and returned to the second historic high level of EUR 608 million in Q4. Net interest income from “New Europe” business (post-Communist countries in Central and Eastern Europe) equaled EUR 781 million in 2009 and contributed 33 percent to the group’s net interest income. In total, group fee and commission income stood at EUR 496 million in 2009, against EUR 618 million in 2008, as commission from banking activities amounted to EUR 418 million and fees from other activities reached EUR 78 million. In “New Europe,” total fees stood at EUR 168 million and accounted for 34 percent of the group’s total fee and commission income. Anda Dragan BUSINESS REVIEW / March 15 - 21, 2010
The Ministry of Communications will install another 300 hotspots in public areas throughout Romania this year. The measure is meant to expand access to broadband services to allow more and more users to get the information they need through laptops, PDAs (personal digital assistant) or desktops with WiFi connection devices. The 300 hotspots will be installed at an estimated cost of RON 923,000, without VAT. Internet provi-
sion will be taken care of by the ministry for a year. Last year the ministry launched procedures to install 11 hotspots in the first stage of the project. They were set up by the National Society of Radiocommunications in Botosani, Brasov, Piatra Neamt, Ploiesti, Ramnicu Valcea, Slatina, Suceava, Targoviste and Targu Mures. Romtelecom then installed 200 hotspots in 32 counties in 2009.
All in all, a total of 211 hotspots were established last year, 75 indoors in places such as city halls and libraries and 136 outdoors in parks, historical centers and pedestrian areas. The total investment was RON 590,000, before VAT. The ministry will provide the internet connection for the 211 hotspots until the end of 2010, with the possibility of extending the service for another two years. Otilia Haraga
Mazars' local hub grows turnover ten fold in three years, promotes new partner What are your overall growth expecta tions for the Mazars office in Romania? Where does the Romanian subsidiary stand in terms of growth in Mazars' CEE strat egy? As to 2006, this year’s turnover of Mazars in Romania is approximately ten times higher. Three years ago we went through a merger What are the latest trends and key chal - and now we can say that things have taken lenges on outsourcing and fiscal consultancy the right turn, making us look confidently and optimistically into the future. Although the services? Currently, when most of our customers’ economic environment is rather unfavorable, Gabriel Sincu, Partner, Head of Tax & Outsourc- businesses witness a slippage, it is not at all in the year 2009/2010 we contemplate to easy to sell tax advisory services. The large grow, even if slightly, but more importantly, ing, Mazars transactions of 2-3 years ago are ever fewer, to lay a solid base for the future. The crisis What are your main targets as newly ap - competition is ever stronger and price has be- cannot go on forever and, when the economy pointed partner of Mazars in Romania? How come the ultimate factor in customers’ deci- is revamped, we wish to be on the front line do you plan to achieve these targets? sion. Nevertheless, having a solid customer and benefit from the investment we are makMazars partnership boasts two main base which has been built on healthy cooper- ing at present. stakeholders: customers whom it serves and ation relationships, we hope that we shall sucAs for the Bucharest Office, it has already people with whom it can serve its customers. ceed in surmounting the difficulties of this pe- become a small regional centre considering It goes without saying that my targets are re- riod, particularly because we have noticed a that our Managing Partner, Mr. Jean-Pierre Vilated to these stakeholders: I pursue, on the slight growth as to 2009. groux, is responsible, inter alia, for the develone hand, the development of our business In respect to outsourcing services, we opment of Mazars in the Balkans and the and, on the other hand, the consolidation of may say that they have significantly devel- countries of the former USSR. an expert team that can successfully over- oped since many companies, which are come any challenges coming from our cus- among the newcomers in the Romanian marHow much did each of the services of tomers. ket, have chosen to outsource part of their fered by Mazars bring in terms of revenues to As regards our business, since 2007 operations, a fact offering them greater flexi- the company last year (percentages) which meant a new starting point for Mazars bility paralleled by higher service quality. In and how do you expect this to evolve this in Romania, we have been promoting a busi- this area, our target is quite ambitious, but we year? ness strategy which can make a difference hope to attain it, especially if we consider that, Certainly, if we look to the last available from a service quality perspective. This has by the middle of Mazars fiscal year (i.e. 1st figures (i.e. 2008/2009 fiscal year) when the not been easy because excellence requires September – 31st August), we have complied consolidated turnover was EUR 774 million, commensurate costs and, in the current mar- with the planned budget. the EUR 4 million achieved by us does not ket conditions where price is decisive, such represent much, but we should be unrealistic strategy is ever more difficult to implement. What sort of companies are now choos - to compare ourselves with our colleagues in However, we are proud to say that most of ing your services, what sort of new clients France, Great Britain or Germany. We are our customers have shown full satisfaction at have you been adding lately? among the second-ranking offices of Mazars our performance and recommend us to their Mazars customer target belongs to the Group, but we are expected to come nearer business partners as being highly reliable. In OMB (i.e. owner-managed business) sort to our colleagues of Portugal or Ireland withfact, our customer portfolio has basically which is medium-sized to large and seeks ef- in a medium term. Undoubtedly, we must grown locally, while we developed a produc- ficient, forthwith applicable, solutions, being traverse a long and bumpy road but, having tive cooperation with most of our customers appreciative of our professionals’ creative in view the resources of which we avail ourunder Haarmann Hemmelrath brand, before thinking. Certainly, this does not prevent us selves, we are convinced that we shall cover it the merger with Mazars. from working with customers that are multi- successfully. As a matter of fact, the slogan With reference to people, we have en- national companies, such as Siemens, Bayer which inspired the founder of this firm, Mr. deavored to create a pleasant business at- or E.On Energy, or with small companies hav- Robert Mazars (now 90 years old, still fond of mosphere in Bucharest Office, so that people ing development prospects. This year we mountain climbing), was «one step every should come to their workplace with pleasure have added new customers of each sort to day». If we succeed in doing so, we shall reand confidence. People get promoted on the our portfolio. alize that we have got much ahead. basis of strictly professional criteria and each one of them is encouraged to stride towards the desired target. To this end, by means of its international network, Mazars offers its people opportunities to expand their expertise and have broad access to the latest information in their specific field of activity.
7
NEWS
SAS Grup posts EUR 1.6 million turnover SAS Grup posted a turnover of approximately EUR 1.6 million (RON 6.8 million) for 2009, an increase of 32.16 percent compared to the previous year when it posted nearly EUR 1.3 million (about RON 5.15 million). Its net profit increased by 69.9 percent from EUR 99,000 (RON 395,000) in 2008 to about EUR 158,000 (RON 670,000) last year. The growth is down to client acquisition, the company having boosted its customer base from 220 customers in 2008 to 400 in 2009. SAS Grup representatives foresee a 10 percent increase in turnover in 2010. The solution SAS Fleet Pro for the management of car fleets is expected to maintain its annual growth rate of 33-35 percent. SAS Fleet Pro posted a 33 percent increase in 2009, from 6,000 pieces of equipment ac-
Adrian Dinu, general manager of SAS Grup, predicts demand in his firm’s field to rise
tive at the beginning of the year to 8,000 in December. Approximately 95 percent of the company’s revenues came from these solutions the previous year. “An important element of the strategy in 2010 is to support the
growth rate that new products such as SAS Tracker and SAS Locator have registered until now. The aim for this year is that cumulated sales for the two solutions reach approximately 20 percent of total turnover,” said Adrian Dinu, general manager of SAS Grup.
The firm predicts demand in this segment to surge significantly in 2010, as the economic crisis has underlined the need to keep tabs on transportation costs. By implementing these systems, distribution companies and producers who make their own deliveries incur 20 percent lower expenses, said Dinu. Last year, the company launched two new products SAS Locator and SAS Tracker. “We were surprised to see high demand for these products from leasing companies who are interested in using the SAS Locator solution to locate and recover cars, as well as from companies who lease certain goods that can disappear once the firms that took them close down,” added the GM. Otilia Haraga
UPS strengthens Bucharest Clal Romania gets rebadged as presence on tough market Platinum Asigurari Reasigurari Parcel services company UPS invested in upgrading and expanding its portfolio of services in Romania last year with the launch of domestic express pick-up and delivery services and leased a new facility for its small package and supply chain solutions operations at Bucharest-Otopeni airport, according to Michael Mavropoulos, regional director of UPS Greece, Balkans & Mediterranean. This became the firm’s largest location in Romania. The company runs other pick-up facilities in Bucharest, Constanta and Timisoara “The main factors shaping the small package delivery market in Romania last year were no different from those in other countries in Europe. With diminished trade and consumer spending alongside increased unemployment and all the other issues associated with a worldwide downturn, conditions were far from ideal,” Mavropoulos told Business Review. Organic growth through acquisitions is always an option for UPS, he commented. “We are always looking for op8
portunities to enhance our ability to better serve our customers. If we feel our customers’ best interests are served by acquiring a company, then that is always an option for UPS,” Mavropoulos said. “UPS has typically built up its business across Europe through a combination of organic growth and acquisitions.” Without disclosing sales figures for Romania, the regional director added, “On a global basis, just like everyone else, our business was affected by the worldwide economic downturn in 2009. The financial crisis led to a decline in consumer spending and business trading activity and, consequently, in fewer shipments being moved than in 2008. ”However, he noted, the company maintained its industry margins and expanded its market share outside the US, despite the difficult environment. “We’re optimistic about the future. Economic recovery is now under way in many regions of the world […],” said Mavropoulos. Corina Saceanu
Platinum Asigurari Reasigurari is the new name and identity of the former Clal Romania, representatives of the insurer announced last week. The company intends to focus on non-car insurance products, in response to the recent evolution of the Romanian insurance market. “In this context, our objective is to offer tailor-made insurance programs to our customers, in order to cover a wide range of their needs. We won’t neglect car insurance. We will remain in minimum contact with it but we expect this market – which makes up more than 75 percent of the total market insurance – to stabilize and reach normality,” said Efraim Naimer, CEO of Platinum. He added that the company intended to continue to develop insurance products to complement its portfolio, both on the well represented and more peripheral strands of the Romanian market insurance. According to Anca Babaneata, deputy CEO of Platinum, the company has identified an opportunity on the SME and individuals seg-
ment. “We therefore intend to promote our current products but also new ones for which the company has received the license from the Insurance Supervisory Commission, such as marine and nautical, aircraft, credit and assurance, performance bonds and medical insurance,” said Babaneata. According to the deputy CEO, the company intends to reach a EUR 5-6 million in premiums this year and EUR 15 million in the next three-four years. The firm posted over RON 11 million in turnover last year, and has seen investments of over RON 65 million since its entrance on the local market, back in 2006. Insurance Supervisory Commission approved the takeover of Clal Romania by a private investors group in October last year. At present Platinum is a new general insurance company built on the structure of Clal Romania with its whole capital being Romanian. The main stakeholder is Vienna International Holding, a company specialized in financial services. Anda Dragan BUSINESS REVIEW / March 15 - 21, 2010
CALENDAR/WHO’S NEWS
EVENTS, BUSINESS AND POLITICAL AGENDA MARCH 16 é 15:00 Niki Lauda organizes a press conference at the Commercial Sec-
tion of the Austrian Embassy in Bucharest. By invitation only.
MARCH 16 é 12:30 Kraft Foods Romania organizes a round table on the topic of ca-
reer success at its headquarters. By invitation only.
MARCH 16 é 10:00 Citibank organizes the 2010 edition of the Business of Luxury
Forum at Capital Plaza Hotel. By invitation only.
MARCH 17 é 11:00 DLA Piper organizes an informal meeting at its headquarters in
the Metropolis Center. By invitation only.
MARCH 17 é 11:00 The Romanian Breweries' Association organizes its annual con-
ference at Radisson Blue Hotel. By invitation only.
MARCH 17 é 18:00 Leadership School organizes a celebration event at the National
Museum of Contemporary Art in Bucharest. By invitation only.
MARCH 18 é 18:30 CEU Business School organizes an open masterclass with Sandy
Vaci, adjunct senior lecturer with the school, on ‘Global Best Sales Practices. How to Beat the Recession and Come Out Ahead!’ The event takes place at the JW Marriott.
MARCH 24 é Business Review organizes the Swiss Business Forum at the InterConti-
nental Hotel. By invitation only.
APRIL 14 é Business Review organizes the Greek Business Forum at the InterCon-
tinental Hotel. By invitation only.
APRIL 28 é Business Review organizes the Spanish Business Forum at the Inter-
Continental Hotel. By invitation only.
JUNE 26 é The ‘Run Romania’ Sports Association organizes the ‘Run Romania’
project.
Romanian state to issue EUR 1 billion Eurobonds The government is planning to sell EUR 1 billion of five-year Eurobonds, with a 5 percent coupon. The bond issue has been oversubscribed about five times at a yield of 268 basis-points above the benchmark mid-swap rate. This is the largest offer of soverBUSINESS REVIEW / March 15 - 21, 2010
eign bonds issued by the Romanian state to date. Clifford Chance advised the international banks Deutsche Bank, HSBC and EFG Eurobank as joint lead managers in connection with the issue. Anda Dragan
WHO’S
NEWS
JUAN SAEZ PALACIOS, 45, is the new business development manager of Cez Romania. He is taking over from Doru Voicu who has decided to step down from the position. Palacios previously worked for GrupoRaga as director of the business development international division. Between 2000 and 2007 he served as CEO of Union Fenosa Soluziona for Romania.
London Ealing Hotel in the UK, operations manager at Tulip Inn Bucharest City and hotel manager at the same property. He graduated from the Tourism & Commercial Management Faculty of the University Dimitrie Cantemir in Bucharest.
DORU VOICU has stepped down as business development manager of CEZ Romania in order to dedicate himself to other professional projects. As of this month he is counselor to the minister of economy, Adriean Videanu. Voicu had been with the company since 2005 and has previously worked for Electrica. He is a graduate of the Polytechnic University in Bucharest.
TRAIAN SIMON has stepped down from the position of general director of Albalact Alba Iulia, in order to dedicate himself to other professional projects. He joined the company in 2005 as commercial director. While holding this position he was responsible for developing a national sales team and seven regional distribution centers. As general director, he has coordinated the company’s development and consolidation strategies over the last two years.
ROXANA STANCIULESCU has been promoted to head of the retail agency at Jones Lang LaSalle’s Romanian office. She joined the company in January 2007. As a senior member of the local staff, Roxana was involved in the leasing of the first Romanian outlet center, Fashion House Bucharest, located on the A1, which opened in December 2008, and also AFI Palace Cotroceni, which opened in October 2009. RAZVAN SECAREANU has been appointed executive director at Brand Management. He has six years of experience in the media, having previously worked for Carat as media buyer on the out-of-home segment. In his new position Secareanu will oversee the activities related to new business, client service, production and marketing of the Romanian office. MIHAI ZAMFIR is the new COO of Concept Hotels. He was previously general manager of Angelo Airporthotel Bucharest. Zamfir began his career in the hospitality industry in 1994 and his subsequent positions include front office manager at Holiday Inn
CRISTIAN POPESCU, 44, is the new general director of Cisco Romania. He has served as interim general director since July 2009. Popescu joined the firm in 2004 as enterprise account manager and managed the sales teams on the enterprise, mid-market and SMB segments. He is a graduate of the Polytechnic University in Bucharest. PAUL PANCIU, 33, was appointed general manager of the mortgage division of GE Money Romania. He joined the firm in 2007 as alternative sales channels manager. Panciu has previously worked for Credit Europe Bank as alternative sales channels manager and as regional sales manager. He holds a master’s degree in International Business from the Norwegian School of Economics and Business Administration, a degree in business administration, and is also a graduate of the National School of Political Studies and Public Administration in Bucharest.
Business Review welcomes information for Who’s News from readers. Submissions may be edited for length and clarity. Feel free to contact us at editorial@business-review.ro 9
INTERVIEW
Pedersen & Partners: We were already in crisis mode Headhunters Pedersen & Partners,
When did the firm take cost-cutting measures and what were the results? To what areas were those cost-cutting measures applied? We focus on our operational efficiency and carefully monitor our operational costs, meaning that we closely monitor our suppliers’ lists and travel expenses while running cost-benefit models. The fact that we acted early at the onset of the crisis had a great impact on the health of our organization. As an executive search firm, we receive first-hand information about business and economic trends and therefore have no excuse for not applying this knowledge when running our own firm. I was amazed to see that most of our competitors started carrying out costcutting exercises and adapting their strategies half-way through the crisis and are still not done.
which has an office in Romania, saw its revenues fall last year but kept the same profitability margin. The executive search firm started to optimize its costs even before the crisis hit, working on compensation, headcount and travel expenses, says ULRIK RASMUSSEN, partner at the Bucharest office. Corina Saceanu Did Pedersen & Partners increase its turnover in Romania in 2009 vs. 2008? What is the outlook for this year? In 2009 we continued to take a more prudent business approach and did not add new offices or expand our range of services, but rather focused on our core business – executive search – and on supporting our existing clients. Despite a decrease in revenue, we managed to keep roughly the same profit margin as in the previous years. The outlook for 2010 is positive as our unique business model – as a wholly owned firm, as opposed to a franchise – has proven itself. Our consultants work as individual profit centers, allowing us to centralize all back-office functions and processes across 36 countries. By involving our senior staff in regional searches, we ensure that benchmarking, case studies and in-house expertise, regardless of industry background and location, are used for the purpose of servicing our clients and for internal knowledge sharing and training. Running one 10
with suppliers, while keeping all the offices operational. This enabled us to sustain a solid cash position and sound profitability despite our falling revenue. In 2009 we managed to increase salaries while attracting key executive search consultants from the competition. We moreover succeeded in acquiring the Russian operations of EWK International. We try to maintain the balance beWhat measures have been taken lo - tween selective cost-cutting and investcally and internationally by Pedersen ing in future growth. & Partners to weather the storm? To what extent does the firm de Despite our aggressive expansion in recent years, we run the organization as pend on cash from current activities to if there was going to be a crisis tomor- cover its costs in Romania? row. We have always put great emphasis Here I’d like to stress that we operon resource and process optimization. ate as one office across the 36 countries Due to the nature of our business, we where we have a presence, therefore we talk daily with decision makers and don’t regard Romania as an individual therefore had no excuse for claiming ig- case in terms of costs and profits. Since norance of the impending crisis. When the opening of our Bucharest office in we realized the magnitude of the reces- 2003, we have been fortunate to bring sion, we ran the numbers and had the together a team of professionals that are new strategy implemented in less than a recognized in various industries, which month. We implemented cost reductions has enabled us to build loyal client portrelated to compensation, headcount and folios and high-end performances in Rotravel expenses, and re-negotiated terms mania.
“no borders” organization, our aim is to apply a coherent and uniform approach in every country. Our clients, in their turn, find it convenient having one point of contact for all their recruitment assignments and trust us to assemble the best team of experts who will meet their needs. No other company has such a model.
What expansion plans does the firm have in Romania and elsewhere? We are aggressively upgrading our organization across some of the key markets. Besides the acquisition of EWK International, we are in advanced discussions with some of the heavyweights in the executive search industry to join our firm. In 2009 we put our expansion plans on hold. However this year we are back on track and are planning a minimum of five new office openings. How have fees on the executive search market changed in Romania over the last year? Where do you stand in terms of this? Have you cut or varied your fee structure? Clearly we saw a decrease in fees and a growing pressure from our clients to negotiate the terms. Many are also pushing for contingency-based terms; however this absolutely contradicts our business model as we are a retained search firm. I still believe we provide high value-added to our clients, treat each assignment as a separate unique project and accept only a small number of searches. We do not lose many pitches, despite keeping our high fees. The fee flexibility that we offer mostly now applies to regional framework agreements where we are chosen as preferred suppliers. corina.saceanu@business-review.ro BUSINESS REVIEW / March 15 - 21, 2010
ENERGY
Emissions trading set to put foot on the gas After Sibex started emissions trading
lowances, Sibex connected the Romanian Clearing House to the National Environmental Protection Agency system,” Sibex economist Cristina Padure told BR. While the subject appears technical, EUA certificates are issued under the EU system of greenhouse gas emissions trading (EU ETS), one of the pillars of EU policy relating to climate change and pollution reduction. Under this system, EU member governments establish national maximum levels for greenhouse gas emissions and set maximum limits for industrial operators in each country. For the period 2008-2012, the European limit is 2.08 billion in allowances per year. Of this amount, Romania’s share is 75.9 million tons annually, meaning 3.6 percent. Six companies have received almost half of the total 379.7 million certificates allotted to Romania. Those companies that cannot keep their carbon dioxide emissions within the limit allotted must buy extra certificates from those who do not use up their allowance.
– since gas certificates have become securities as part of a new measure implemented by the National Securities Commission – the Bucharest Stock Exchange is now preparing to become a player on the greenhouse gas emissions market. Despite the NSC move the number of transactions is still extremely low, while the market is waiting for clarification of the VAT regime and other procedural aspects of the trading system for the allowances. Dana Ciuraru The Romanian trading system for greenhouse gas emission allowances (EUA certificates) is getting a facelift. The National Securities Commission (NSC) recently categorized the emission allowances as a security, which can also be traded on the local capital markets. According to Sibiu Monetary Financial and Commodities Exchange (Sibex) specialists, transactions with EUA certificates have been possible since January 22 of this year. As expected, the NSC measure 12
The big clean-up: the emissions trading system is designed to reduce pollution
has piqued the interest of both the Sibex and Bucharest Stock Exchange (BSE). BSE officials told Business Review that they are interested in developing this trading scheme as they want to diversify the portfolio of services offered to their investors. “The NSC specifications to label an EUA certificate as a security opens new opportunities for the organization of a regulated market through which demand and supply for such products can meet. The BSE is interested in expanding the range of products and services we can offer to investors. The transac-
tions closed on the BSE market follow the complete circuit, at the central depository, for the clearing and settlement operations involved,” said Anca Dumitru, general manager of the BSE. While the BSE has recently expressed its interest, Sibex is a step ahead, having already started trading EUA certificates. “In January we registered ten transactions at RON 53.04 per ton. The following transactions with EUA certificates were closed on March 5, when 44 contracts were transferred at RON 53 per certificate. To launch transactions with carbon dioxide emission al-
NSC
CHANGE GIVES RISE TO NEW ISSUES
The NSC measure to label the emission allowances as securities has a web of implications. Specialists say while the move could boost the stock exchanges in this area, which many players would welcome, certain aspects remain opaque. “One problem which still requires clarification is the VAT regime on EUA certificate transactions. Before the NSC’s announcement, these types of transactions were subject to VAT, but, as we know, deals involving securities are VAT exempt. Therefore clarification of this issue from the Finance Ministry is more than welcome,” Razvan Pasol, Intercapital Invest GM, told BR. BUSINESS REVIEW / March 15 - 21, 2010
ENERGY
Anca Dumitru, Bucharest Stock Exchange GM
Razvan Pasol, Intercapital Invest GM
Furthermore, Pasol believes that the national legislation in this area should be correlated with EU regulations, as the mechanism to reduce gas emissions and trade EUA certificates is established at European level. “Also, the measure taken by the NSC blocks the activity of those intermediaries specialized in EUA certificate trading, who are not part of the capital markets, which could reduce the trading market overall,” said the GM. Intercapital Invest carried out the first EUA certificate stock transaction in Romania and, according to Pasol, “We have big plans to develop this market along with our partners.” Currently, the price of EUA certificates has reached the same value as these certificates are going for on the largest European stock ex-
changes, like Bluenext (France) and the European Climate Exchange (Great Britain). “On the Sibex market the certificate price is set by supply and demand. The last transaction was carried out at a price of RON 53 per ton (EUR 13/ton), while the Bluenext market price of a ton of CO2 was EUR 13.15. The evolution of this market depends solely on the wishes of the holders of the certificates,” said the Sibex economist. Although welcomed by market specialists the impact of the NSC measure is not yet obvious: for the moment, at least, the number of transactions is still extremely low, while the market is still calling for clarification of the VAT and other procedural issues. But this is a first step. dana.ciuraru@business-review.ro
Companies
No. certificates (mln) *
Mittal Steel Galati
71
Turceni Energy Complex
34
Rovinari Energy Complex
28
Electrocentrale Deva
20
Craiova Energy Complex
17
Romag Termo
14
Lafarge Ciment Medgidia
12.3
Petrom Arpechim
9.6
* Number of certificates allotted to these companies for 2008-2012 BUSINESS REVIEW / March 15 - 21, 2010
13
MONEY
Banks brace themselves for bruising 2010 Despite 2009 being the first full year of crisis on the Romanian market, local lenders managed to post mostly positive results. But specialists expect 2010 to be less auspicious for them, making the banking system unlikely to post a profitability rate over the level registered in 2009. Anda Dragan Many players from all commercial fields use the first few months of the year to announce their financial performances, and the banking system is no exception. Many lenders active in Romania have already posted both their financial results for last year and announced their strategy or provisions for 2010. Against the odds, a good number of local banks registered positive results last year, even though 2009 was the first full year of crisis for the domestic market. According to Nicolae Cinteza, manager of the supervisory department at the National Bank of Romania (BNR), quoted by Mediafax, more than half of the 42 credit institutions in Romania – 22 in total – finished 2009 without losses. 14
Cezar Furtuna, audit partner in financial services at KPMG
Data available on the market indicates that the banking system posted a RON 772.3 million profit in 2009, 5.7 times lower than the RON 4.4 billion record figure registered in 2008, while the value of provisions almost doubled. In these conditions, profitable lenders posted cumulated net earnings of over RON 2 billion, with the losses in the banking system surpassing RON 1 billion. Lenders posted an overall loss of RON 69.23 million in December alone, while provisions increased by almost RON 500 million, to RON 14.96 billion. According to Cezar Furtuna, audit partner in financial services at KPMG, the banking system posted a ROE of 2.73 percent in 2009, 84 percent lower than the 17.04 registered in 2008. “Our analysis has found that the decreasing trend in lenders’ basic
profitability – without taking into account one-off transactions such as the sale of Asiban in 2008 or similar moves – has been visible since 2008. According to a KPMG study which will be published in the near future, the ROE was a little over 11 percent in 2008 – compared to 11.44 percent in 2007 – if we don’t include the transactions mentioned above,” says Furtuna. In his opinion, the effects of the current turmoil became visible in 2009 through the exponential increase in the provisions volume (double or even higher in some cases) while interest margins remained the same or rose. Moreover, lenders tried to reflect the higher risks of lending in the interest rates they offered their customers.
WHAT’S
NEXT IN
2010?
“It is unlikely that the banking system will post a profitability rate
over the 2.73 percent registered in 2009, when we are not seeing any tempering of arrears and provisions, despite lenders’ efforts to restructure and re-negotiate with some significant creditors,” says Furtuna. According to BNR data, outstanding arrears reached a record level of over 3.4 times higher at the end of 2009 than the figure posted in 2008. Nicola Calabro, CEO at Intesa Sanpaolo Bank, agrees that lenders’ profitability will be lower this year than in 2009, as banks will suffer the effects of 2009’s increase in provisions combined with a gradual recovery in lending activity. Moreover, the fiercer competition for customers will drag down the margin of interest rates for credit, which will dent lenders’ profits. “We think that the individual results of the credit institutions will continue to be diverse, with large lenders that have significant assets being in a better position to generate additional income from commission or financial operations. This will offset the losses generated by the stagnation of the increase in net income from interest and by the boost in provisions for book debt depreciation,” says Furtuna. According to him, banks’ earning capacity this year will be influenced by many factors. The first is the level of interest margins and the reference rate of the BNR, which has a direct impact on the yields that can be secured by lenders from financing granted to the state. “This activity made a significant contribution to lenders’ incomes generated by interest in 2009. The impact was also increased by the release of liquidities as a result of the reduction in minimum mandatory reserves both for RON – from 18 to 15 percent – and foreign currency – from 40 to 25 percent,” says Furtuna. Second comes the evolution of provisions for credit depreciation and administrative and operational cost control. In Furtuna’s view, the latter is an important component that can generate benefits for lenders without any significant short-term impact on their profitability in 2010. The final factor is “the banks’ capacity to generate income adjacent to the fundamental BUSINESS REVIEW / March 15 - 21, 2010
MONEY lending activity, such as commission from operations and transaction activities with customers,” says the KPMG representative. Specialists expect 2010 to be a year when lenders need to address and manage some issues they did not deem priorities in 2008. Furtuna flags up the identification of less efficient processes, rationalization of network branches, detection and axing of unprofitable products, services and relations, managing a high volume of liquid assets in order to optimize yields, and severe restructuring of customers with underperforming credit. Breaking it down by type of product, this year lenders will focus on mortgages (including the national First House program), co-financing and consultancy services for the attraction of European funds, corporate credit based on solid business plans and cash flow forecasts, credit for SMEs, treasury products such as forward contracts, financial swaps and options on the exchange rate. Calabro of Intesa thinks that many lenders will focus especially on companies’ needs this year. “Banks that increased their market margins exclusively through household credit will need to make greater efforts to restructure their product range,” says the CEO. As for the cautious approach taken by lenders, Furtuna says that the end of 2009 significantly changed the balance sheet structure of credit institutions, with the weight of cash and liquid assets increasing to the detriment of credit offered to customers. In such a context, “lenders’ risk aversion will continue this year too, with banks being cautious over granting credit. We think that a possible recovery in lending might be visible at the end of the year,” he predicts. Another interesting issue highlighted by Calabro is the concentration of the local banking system through acquisitions. “We don’t think we will see such a process on the local market this year, because it hasn’t yet taken place in Western Europe. This might wait until the efforts to recover the European architecture of financial supervising and stability are completed. Then, we will see an increase in large lenders’ desire to make acquisitions in the European region,” concludes the CEO. BUSINESS REVIEW / March 15 - 21, 2010
BANKS’ FINANCIAL RESULTS * BCR Group é Operating result: RON 3,261.5 million (+32.1 percent) é Operating income: up by RON 757.7 million BRD-Groupe Societe Generale é Group net profit: RON 812 million (including BRD Sogelease, BRD Finance, BRD Securities) é Bank net profit: RON 792 million
Banca Transilvania
percent)
é Gross operational profit before
é Net income: RON 695 million
provisioning: RON 610 million (+96 percent) é Operational income: RON 1,293 million (+27 percent) CEC Bank Profit before tax: RON 50 million (+11 percent) ING Bank Romania é Gross profit: RON 84 million (-20
(+30 percent) Millennium Bank é Operational income: RON 107.7 million (+100 percent) OTP Bank Romania é Profit after tax: EUR 4.2 million é Operational profit: EUR 25.6 million (+100 percent)
Reported by the time Business Review went to press
15
PROPERTY Romania takes out EUR 315 mln NEPI pays EUR 21 mln for big Japanese financing for airport tube line boxes in Iris Pitesti
Investor Alexander Hergan
The new metro line linking the downtown area with the main airport should alleviate traffic jams
The EUR 315 million Japanese loan which will fund the construction of the Bucharest-Henri Coanda airport underground link has been agreed by Romanian government representatives and their Japanese counterparts during a visit to Tokyo. Romanian president Traian Basescu and Japanese PM Yukio Hatoyama attended the meeting, while the contract was signed by finance minister Sebastian Vladescu and Japan International Cooperation Agency president Sadako Ogata. The line will connect downtown Bucharest to the international air-
port, providing a much needed alternative to driving through the crowded city center. The solution should alleviate traffic congestion in the capital and reduce air pollution, according to the Transport Ministry. The new metro line will require EUR 1 billion of investment in total. Works are expected to last six years. The 16km link will be entirely underground, with 19 stops and a depot. Some 21 trains will run on the new route, which could transport 50,000 people an hour each way. Corina Saceanu
New Europe Property Investments (NEPI) has paid EUR 20.9 million to buy the Auchan and Bricostore big boxes in the Iris retail park in Pitesti from developer Avrig 35, the fund has recently announced. It agreed at the beginning of February to buy the retail park, which consists of Auchan and Bricostore stores. The 7,000-sqm fashion and entertainment galleria, Iris Mall, was not included in the deal, but NEPI has agreed on a oneyear option to buy the galleria as well.
Senso Ambiente: Chinese imports tap into sinking local bathroom fittings market
Drumul Taberei metro line works attract 18 bidders No fewer than 18 construction companies and consortia have submitted offers to carry out the structural works for the 8km metro line connecting Drumul Taberei to downtown Bucharest, Metrorex, the Bucharest metro operator, has announced. Each of the two sections of the metro line will have five or six bidders on the final list. The 18 companies who submitted offers were: Metrostav, Aktor, the association between Construcciones Sanchez Dominguez Sando-Apolodor Comimpex, Societa Italiana per Condotte d’Acqua, the Comsa-Copisa Constructora Pirenaica-Sird-Prospectiuni consortium, the association between Dogus-Gulermak-Moscovskii MetrostroiSalini, that between Impresa Pizzarotti & CSPA-Seli Spa, the Astaldi-FCCDelta ACM-AB Construct consortium, JV Porr Technobau und Umwelt AGPorr Construct-Hidroconstructia-SCT, 16
the Metro 5 consortium, Yapi Merkezi Insaat Ve Sanay As, Max Bogl, Obrascon Huarte Lain, the association between Soares da Costa Euroconstruct Trading 98-PA & CO international, Claudio Salini Grandi Lavori Societa Per Azioni, the association between Yuksel Insaa-Ilci Insaat Sanay ve Ticaret-Yuksel Proje Uluslararasi and Open Joint-Stock Company Kievmetrobud. The final list of bidders qualifying for the next stage of the process will be released in the next 30 days. Both projects will require EUR 277 million in investment, with financing coming from the European Investment Bank (EIB) and guaranteed by the Romanian government. The project is estimated to take around 30 months to build while the first passengers should travel on the new tube line in about four years. Corina Saceanu
The recently-acquired property will bring the fund a net operating income of EUR 4.67 million. Iris Park is an over 83,000-sqm site with approximately 33,000 sqm of gross lettable area. The purchase price will be settled through the issue of 9.3 million ordinary shares in NEPI at a price of EUR 2.25 per share. Of these shares, 2.4 million will be locked in for a minimum period of 12 months. The company continues to negotiate the acquisition of other retail assets in Romania, although it stresses that there is no certainty that the negotiations will be concluded successfully. “Accordingly, shareholders are advised to continue to exercise caution when dealing in their NEPI shares until further announcements are made in this respect,” the company wrote in a recent release to the London Stock Exchange, where it is listed on the AIM market. Avrig 35, the seller of the project, is controlled by investor Alexander Hergan. Corina Saceanu
Down the plughole: players are hoping the bathroom fittings market will bounce back this year
The local market for bathroom fittings, excluding tiles and faïence, was worth around EUR 60 million last year, according to Virgil Lixandru, head of marketing and sales for bathroom furniture and equipment distributor Senso Ambiente. Around 75 percent of it was made up of no-brand products, many of which are produced in China, and only 25 percent constituted branded products. Of this portion, around 30 percent consisted of ceramics, such as sinks, 35 percent fittings and 40 percent wellness items. While Lixandru expects the market
to stagnate, Senso Ambiente is planning to double its market share of branded bathroom equipment sales in Romania to 22 percent, while increasing the number of distributors to 200, according to the head of marketing. The company is currently working with 60 distribution firms in Romania. Indirect sales make up 75 percent of the total, while direct sales to professionals and individuals who come to the firm’s showrooms cover the rest. In 2008 the company posted a EUR 2.5 million turnover, but has yet to report its 2009 figures, after the market of bathroom equipment declined. The company plans to start distributing new brands this year and expand its distribution of existing ones in a total of 85 cities in Romania. Senso Ambiente is part of ITS Group, which includes IT&S, a company specializing in IT&C; ITS Events Management, which organizes fairs and exhibitions; as well as Aqvila Rucar business center. The company contributes around 20 to 25 percent of the revenues generated by the group. Corina Saceanu BUSINESS REVIEW / March 15 - 21, 2010
PROPERTY Final Distribution wants 12 percent sales increase for roofing product
Raise the roof: Final Distribution expects an increase in sales this year
Final Distribution, the firm which distributes Gerard roofing tiling in Romania, expects to see a 12 percent increase in sales of such products in Romania this year on 2009, the company has said. “Even during less favorable conditions, Romania offers a high increase potential on this segment, which will be more and more visible once the market starts to settle, which will probably happen in the second half
of the year. For 2010 we expect a 12 percent sales increase for Gerard,” said Dan Mircescu, general manager of Final Distribution. The company sold 200,000 sqm of Gerard tiling last year, out of a total market volume of 250,000 sqm for similar products. Romania was the third most dynamic market for Gerard in Europe based on the volume of sales for the firm. Corina Saceanu
CEE banks move into real estate as market plunges, says EMRE Capital Management Several banks in Central and Eastern Europe have been preparing to become real estate operators in the last year by setting up private asset management companies to take ownership of underlying real estate collateral, according to a recent report from EMRE Capital Management. “A number of bank websites feature growing lists of properties for sale, generally at prices that will not sell in today’s market,” said George Leslie, principal with EMRE Capital Management. Real estate values, in general, have declined so dramatically that banks will post unsustainable losses if they try to liquidate collateral. “There are many cases in which the borrower’s equity has been wiped out, which is a very bad problem for banks when it occurs on a wide scale,” said Leslie. BUSINESS REVIEW / March 15 - 21, 2010
Borrowers, some of whom have no hope of salvaging any part of their investments, have no incentive to manage cash flow or capital value so the asset typically deteriorates rapidly if it remains under control of the defunct borrower, he added. However, the CEE region does not compete well on the sub-performing or non-performing loan investment markets due to its relatively opaque legal systems and other market imperfections which impair liquidity and transparency. So actually, though properties held in these vehicles are listed for sale, they may not actually be for sale until market conditions improve or some level of value-added has been implemented to enhance capital recovery for a bank, the EMRE principal said. Corina Saceanu 17
BALANCE
What’s cooking in the kitchen Clayton Powell, executive chef at Athenee Palace Hilton Hotel, is in charge of a team of 47, and has a say on everything that goes into the food, from menu creation and ingredient selection to the presentation of the final product. Usually, he says, it’s the small things that count. Business Review had a chat about what ends up on your plate and how it gets there. Otilia Haraga “Fortunately for me, I have over 20 years of experience. So I have a lot of food in my head already,” says Powell. For an experienced chef, creating a menu can be compared to the work of a chemist who assumes that if he or she puts two types of chemicals together, it produces a certain reaction, without actually doing it. “You can actually taste the ingredients in your mind because you have an understanding of how they work,” says the chef. In order to do this, you have to have a memory of the taste. “It is very easy to take a menu and take other people’s ideas and use them as your own but to be a bit more inventive. It is very good to create flavors in your mind, and once you’re convinced in your mind they’re going to work, you can actually do it,” he explains. How does one become a chef at an international hotel? Powell attended a catering school in the United Kingdom for about three years in the 80s. 18
A man who knows his onions: Clayton Powell says a chef must have a handle on everything that goes on in the restaurant
He has worked for the Hilton chain for approximately five years, starting in Amsterdam where he spent two years. He then transferred to Prague as operations sous-chef, overseeing all the major evening events. Next he was offered a position in Bucharest and decided to take it. That was close to two years ago. “It is basically similar to any line of work: you learn the basics in school but it never materializes until you put it into practice and spend several years in the industry,” he says. Most people pigeonhole chef work as one particular job but Powell says the role varies depending on whether it is based in a hotel, restaurant or catering company: the job and expectations are completely different. The difference between a restaurant and a hotel is both in demand and scale. Both facilities are very much
customer driven, but there are fewer demands on the chef financially in restaurants. “In hotels, you really have to get the balance right between quality, creativity and costs. There is a lot more to take on board here. You normally do it with bigger teams. Not everything is within your hands, so you have to deal with it in a totally different way,” says Powell. The work in the Hilton kitchen is divided between job-specific locations for both hygiene and functionality purposes. There are separate parts of the kitchen: the main cooking area, a kitchen for cold preparation of foods, two different pastry kitchens, the butcher’s, the fish room and another kitchen on the other side of the building which serves the bistro and brasserie.
Currently, the team of 47 is split among several departments. There is a small staff in the canteen. Part of the staff is in the stewarding department which is responsible for cleanliness at the back-of-house, out of public areas. The pastry department comprises about seven people. Ninety percent of the pastry products that are served within the hotel are produced by this team. The other personnel are the cooks and supervisors for restaurants and banqueting. At the moment, three restaurants are operational. Last year there were four, including La Strada. A typical workday for Powell starts with a meeting which all the heads of departments attend every weekday morning. A lot of the time is spent giving little pieces of guidance or advice to people. BUSINESS REVIEW / March 15 - 21, 2010
BALANCE “But when you put it all together, this is probably what you have done for the majority of the day. These silly little things like telling somebody to put the biscuits in a straight line on the plate…,” he says, adding that one major part of his job as executive chef is coaching people so that they can later re-apply the principles, otherwise you would be starting from zero every day. In fact, of all the cooks, only four have ever worked abroad, so it is helpful for them to have somebody foreign who can show them a new approach to things. The coaching process mostly takes place through the six-seven supervisors in different departments. “I communicate with my team but I very rarely give the instructions directly to the individual, unless the supervisor is not there. Especially in an environment like the kitchen, you cannot afford to have inadequate supervisors: you need people who are respected and to whom other people will listen and take advice from,” he explains. On a daily basis, an executive chef has to be in charge of such things as controlling costs and expenditure within the department and the quality
BUSINESS REVIEW / March 15 - 21, 2010
of the products that come into the building. You have to be in line with the level of business. Ideally, the costs for any food operation shouldn’t go above 32 percent of the revenues, he explains. “Sometimes, I am amazed when I go around the city and see restaurants with really low prices and I know that they can’t be making this 32 percent. I think for the business to be comfortable and efficient, they really should be within this 32 percent target. This is the minimum they should have,” says Powell. In most other countries, the hotel will be purchasing from suppliers who generally deal with multiple hotels. If they are already dealing with anything from four to thirty Hiltons, they supply the same sort of products to all of these hotels, which takes a lot of legwork out of it. “Here everything has to be sourced by us, as we are only buying for ourselves and you would actually be surprised… In a restaurant, you maybe serve eight or nine of a particular dish a day. Here we can be serving up to 300-400 portions a day. Trying to have the same quality, quantity and consistency is very difficult, so this will probably consume a lot of a
chef’s time in a hotel,” says Powell. Last year, for each of the Hilton’s restaurants, the menu was changed three times. But it is not just about menu creation. First, you have to go to the supply chain and make sure you have the products coming in not only next week when the menu begins but also in three months’ time. “Most important for me is to ensure you have a synergy within the menus. Even if it looks as though I have 180-200 different dishes between the menus, I have to ensure that the principal ingredients such as the fish, the meats, are there. I try to use them as many times as possible in the overall menus so that I have control over the costs. So, if you limit the quantity of different items you have, that way you can limit the quantity of waste that you have,” he explains. By contrast, in a restaurant, a chef would only have to worry about one menu and not about the synergies and the number of different items. “But when you multiply it by five, you really have to have extensive control over it. And you have to be consistent in the pricing throughout the different outlets. Basically, you have to have the whole overview and keep in mind what was on the
previous menus, what the client was asking for,” he adds. For events like weddings, traditional Romanian dishes are required. Powell says he easily learned about Romanian cuisine from colleagues. “I think Romania kind of holds onto its Latin roots and tries to incorporate all Italian. The simplicity of it is very similar to Romanian food. I am talking here about the quantity of ingredients and the preparation itself, not the time it takes you to roll the cabbage for sarmale, for instance,” he says. A common misapprehension about gastronomy is that the finest foods are the best foods. “For example in Romania people do not eat lentils anymore. For me, if lentils are nicely cooked, even if it is a peasant food, it is something I really enjoy.” The same applies to ingredients. “You could ask a chef: ‘What is your favorite ingredient?’ And because it’s an interview, the chef would say, ‘My favorite ingredient is foie gras or truffles.’At the end of the day, I think the onion has probably done more for cooking than anything. Something as simple as this, which people overlook… And you actually ask yourself what would the world be without it?”
19
ENTREPRENEUR
A healthy appetite for business With La Mama, Cafepedia and Charlatans in his portfolio, Catalin Mahu, owner of Trotter Restaurant, has two main objectives on his agenda for this year: to consolidate and develop his business so it posts a EUR 7.5 million turnover in 2010 Anda Dragan Catalin Mahu’s entrepreneurial journey began in his student days, when he had little or no experience in the field. Despite graduating from the Automotive Faculty at the Polytechnic University in Bucharest, Mahu has never worked as an engineer. He learned about business from his own efforts and mistakes, followed his vision and is still active on the market – and profitable – in the current downturn. Some entrepreneurs seem to have business in their blood; they can turn their hand to almost anything and earn a buck from it. This certainly seems to describe the young Mahu, who started to do business back in 1990, while still pursuing his studies. “I was buying and selling everything I could. I had an audio cassette-recording studio, I had shops, centers specialized in renting video cassettes, and finally I embraced the restaurant industry,” remembers Mahu, the owner of Trotter Restaurant, the company that operates restaurant chain La Mama, cafe chain Cafepedia and Irish pub Charlatans. He enjoyed a great advantage at that time: the economic context of the 90s was favorable to him, given that the market was still forming and almost 20
‘Greed is good’: Catalin Mahu hopes that more people will start to eat out in the future
everyone wanted to buy and sell just about anything. Nine years later, in 1999, he narrowed his focus and decided to set up a HoReCa business. Along with a former university colleague, he opened the first La Mama restaurant. It was the moment that marked the start of one of the best known restaurant chains in Romania of recent years. “Since then we have posted constant growth. We opened the first Cafepedia coffee house in 2006 and the first Charlatans Irish pub in 2009,” says Mahu. However, his partnership with his associate crumbled a few years later, leaving Mahu the sole shareholder of Trotter Restaurant. The company currently runs three Cafepedia outlets, two in Bucharest and one in Iasi; seven La Mama restaurants and a single Irish pub Charlatans. The latter was opened at the end of last year, in the premises of the former Cafepedia near Universitatii Plaza, which was totally rearranged for the purpose. In his 11 years as owner of the
company, Mahu has amassed a wealth of experience in the HoReCa field, mainly because of his total involvement in the whole range of activities that running a restaurant entails. “The activity in a restaurant is like a drug that you can’t and don’t want to quit,” says Mahu. Despite the fact that he owns and runs a restaurant business, the entrepreneur doesn’t consider himself a cooking “guru” or an “innovator” of dishes. Instead, he sees himself as a supporter of high-quality products and services. The opening of the first La Mama restaurant had two elements: one practical and the other emotional. It was both a virgin playing field on the restaurant market and a personal dream. “There was nowhere to eat in town at that time. Besides, the idea of running your own restaurant occurs to everyone,” says the young entrepreneur. The toughest period came in 2006-2007. “I remember that there was no workforce available on the market then and the real
estate industry was on the crest of a wave. These issues prevented any development,” says the restaurateur. Like many other entrepreneurs, Mahu has no regrets. “It would be like living in the past. I look to the future. It is easier and more efficient to take such an approach.” If he started another business, he wouldn’t change anything major, just a few details. The businessman says that satisfying your customers is one of the main challenges in his business – which is very people-oriented. “Every day you meet so many kinds of people that you always have something to learn, from your colleagues or customers,” he says. While it might now seem that the local restaurant and cafe scene is very crowded, Mahu does not believe there is real competition in his field at the moment. “Although there are restaurants with similar profiles, it seems that more people don’t go to restaurants than do. This leads us to think that if we focus on growing the market, there will be no competition.” He adds: “There are people who have one single thing on their mind when they wake up: they want other companies’ customers. I think that competition is a matter of the personal vision of every player on the restaurant market.” In his opinion, if you constantly and honestly do a good job, you repay your customers’ confidence and also solve the problem of competition. According to the company’s data, Trotter Restaurant had a market share of about 8 percent in Bucharest two years ago. As for the future, Mahu has two main goals: the consolidation and development of his business, through both maintaining and opening new locations.
Trotter Restaurant é 2008 turnover: RON 34 million é 2009 turnover: RON 28 million é 2010 estimated turnover: about
RON 30 million é Number of employees: 450 é Brands in portfolio: Cafepedia,
La Mama, Charlatans BUSINESS REVIEW / March 15 - 21, 2010
FILM REVIEW / EVENTS
FILMREVIEW:
From Paris with Love
Bourne again: despite its star names, From Paris with Love is an inferior action thriller
If you’re going to blatantly rip off the title of a classic James Bond film, your action movie had better be good. Or, if not good, as least halfway entertaining and stylish. And From Paris with Love does start promisingly. Jonathan Rhys Meyers plays dashing James, an aide to the American Ambassador in France – by day. He’s also moonlighting as a low-ranking CIA spook. In between fielding mysterious calls from his handler, he beats his boss in a game of chess. Highbrow. Perhaps the chess match is a symbol of the story to come – classy and thoughtful, with unpredictable moves from two quality opponents. But if this opening sequence is meant to presage the movie, the filmmakers would have been better off having the characters mud-wrestle, because this buddy-based action flick is messy, monotonous and unseemly. Straight-laced James is paired with John Travolta’s Charlie Wax, a triggerhappy, wise-cracking loose-cannon CIA veteran. (A by-the-book newbie and a maverick agent forced to work together! Of all things!) Wax is in town to singlehandedly solve Paris’s immigration problem – at least, this is what the viewer might assume from the way he cruises the city, killing every brown-skinned person he encounters. Time after time Wax (so-named to facilitate an unfunny “Wax on, wax off” Karate Kid gag) eliminates gangs of vicious non-whites, who – despite far outnumbering the CIA duo – considerately only attack two at a time, allowing themselves to be effortlessly immobilized. What starts off as a standard drugs operation suddenly – the narrative doesn’t bother us with the details – becomes a planned suicide bombing. But when the trail of the bombers leads closer to home for our gun-toting homeboys, things get interesting. Or at least they are supposed to. BUSINESS REVIEW / March 15 - 21, 2010
From Paris with Love comes from the bloodthirsty camera of French director Pierre Morel, who seems to enjoy having CIA men shooting up immigrants in his capital city, as he did the same thing two years ago in Taken, another violent slice of cinematic cynicism. This is not quite as dark, thanks mainly to a lively turn from John Travolta, who seems to be laboring under the impression that he’s still filming The Taking of Pelham 123: he’s now the government agent, rather than the terrorist, but otherwise the performance is identical. Travolta’s role is one of three elements that keep the film from becoming really dire. The second is the action sequences, which are competently handled even if largely bereft of tension from being rolled out one of top of the other with no breathing space in between. The third is the handful of funny lines. But these are scant consolation for enduring this mess. The script reads like it was written by a school competition winner. Meyers is wooden, and often looks (understandably) embarrassed to be saying the lines. And the whole espionage treatment is passé. When its superior namesake From Russia with Love came out in the 60s, viewers were open to believing that spooks lived lives of urbane glamour and excitement, dispatching enemies of the state with witty one-liners before pre-dinner cocktails and bedding attractive women with ridiculous names. But in this post-Bourne, Daniel Craig as Bond era, this just looks outdated and naff. Spies are often damaged people and much of their work is tedious. And they don’t shoot a hundred hardened criminals without suffering so much as a scratch. A knowing reference to Pulp Fiction was doubtless thrown in as a post-modern in-joke. All it did was remind the audience how guns, gangsters and John Travolta can be combined to far better effect that this sub-B movie, subBourne silliness. Debbie Stowe Director: Pierre Morel Starring: John Travolta, Jonathan Rhys Meyers On at: Hollywood Multiplex, Movieplex Cinema
Ciuc Summer Fest replaces B’Estfest this summer B’Estfest, the most popular summer festival in the Romanian calendar, will take a year off. In its stead comes the Ciuc Summer Fest, a smaller music event, organizers Emag!c Entertainment have announced. Three acts have already been confirmed for the event, which will take place between July 16 and 18 at the Iolanda Balas Soter Stadium. Tickets for each day of the Ciuc Summer Fest can be bought online from the site www.myticket.ro and from Diverta stores as of next week, priced at RON 90, RON 160 and RON 220. Otilia Haraga Faithless was the first band to sign up to perform at the festival, on July 16. This is not the first time the outfit – Maxi Jazz, Sister Bliss and Rollo Armstrong – will play Romania: their most famous hits, such as Insomnia, God is a DJ, Bombs and We Come 1, have enchanted local crowds before. Faithless’s style has spanned such genres such as electro, dance, trance, hip-hop, trip-hop and spoken word, and the band cannot be classified as belonging to a particular music tradition. The outfit made its debut in 1995 with the song Salva Mea, which soared to the top of the charts all over the world. Its fifth studio album To All New Arrivals sealed Faithless’s status as one of the most successful electro-dance projects in the world. The band is now preparing for the launch of a new studio album, Calling All the Faithful, of which the first single, Sun to Me, has already been released. The latest confirmation is Pink Martini, a top jazz-lounge and fusion outfit, which will return to Bucharest on July 17. Pink Martini has played two well received gigs in Romania already. The project was conceived in Oregon in 1994 spearheaded by Thomas Lauderdale. Its compositions are an eclectic mix of latino, lounge, classic and jazz, leading critics to coin the group’s output as vintage music. The first album, Sympathique, was released in 1997 and sold 1.3 million copies all over the world. It was followed by three other studio efforts, Hang on Little Tomato, released in 2004, 2007’s Hey Eugene!, and the most recent album Splendor in the Grass. The band is well known for hits
Guitarist Gary Moore
such as Amado Mio, Que Sera Sera, La Soledad, Donde Estas, Yolanda, Una Notte a Napoli, Tempo Perdido and Simpatique (Je ne veux pas travailler). Gary Moore, the stage name of Robert William Moore, started his music career in the 1960s, since when he has performed with artists such as B.B. King, Greg Lake and the blues-rock band Skid Row. Moore got the bug when he got his first acoustic guitar at the age of eight, drawing inspiration from artists such as Elvis Presley and The Beatles. Later, the influence of Jimi Hendrix and Bluesbreakers would steer his musical style towards bluesrock, which has dominated his career. Moore’s output combines rock, jazz, blues and country, and mixes traditional riffs from electric blues and hard rock with heavy metal. He is known for interpretation of hits such as Parisienne Walkways, Out in the Fields, Empty Rooms, Over the Hills and Far Away, Wild Frontier, Friday on My Mind, After the War, Still Got the Blues (For You), Cold Day in Hell and Story of the Blues. 21
EVENTS
Romania turns lights off for Earth Hour Gotan Project tangos into Bucharest in June
Earth Hour is an environmental initiative
Romania will join the annual global campaign Earth Hour for the second time. At 8.30pm on March 27 the lights will go out in various Romanian cities for one hour. This year, WWF Romania has also launched the web page www.earthhour.ro, the campaign’s communication platform, where anyone can sign up as a supporter of the cause. British ambassador to Romania Robin Barnett and Zoli Toth, the frontman of the rock band Sistem, are acting as spokespeople for the initiative. “Around 15 billion tons of carbon dioxide are released annu-
ally into the atmosphere as a result of activities that we have complete control over, such as personal transport, heating and lighting. We can fight against climate change if we make the right choices every day. I especially admire the Earth Hour initiative because it shows us what effect we can have on the planet’s resources in a single hour of average e n e rgy consumption,” said the British ambassador. Last year, approximately one billion people from 4,100 cities all over the world switched off the lights to send world leaders a message on the need to take action regarding climate change. Earth Hour 2009 became the largest environmental campaign of all time. The global initiative is supported by 92 countries. Romania is on the list of participants, with 22 cities having answered the invitation of the World Wide Fund. All these cities will switch off the lights at their landmark buildings, monuments and institutional headquarters, while promoting the Earth Hour message among their citizens or organizing events on March 27. Otilia Haraga
Kilipirim opens for book, music and antiques lovers
Book-arest: avid readers and music lovers are well catered for at the Mega Kiliprim Fair
The Mega Kilipirim Fair will run at Sala Dalles until March 21. It consists of an array of Romanian and imported books, music and audio-video objects and antiques such as collections of coins. As the title suggests – ‘chilipir’ being the Romanian word for ‘bargain’– prices are more affordable than in many bookstores, with discounts ranging between 30 and 70 percent. Visitors can also take part in a raffle, the four winners of which will go home with three kilograms of books from their 22
area of interest – children’s books, literature, hobbies or business. Kilipirim will also showcase the first e-book reader in the country, which includes an electronic library in Romanian. The winners receive a memory card that contains 101 essential texts from Romanian literature. The Dalles Cafe on the first floor will meanwhile host an exhibition of photography which includes 60 works awarded by Nikon in 2009. Otilia Haraga
You’ve been tangoed: The Gotan Project trio are returning to Romania
Gotan Project, whose hits include Santa Maria (del Buen Ayre), Differente, Una Musica Brutal and Queremos Paz, have announced they will return to Romania on June 25 for a concert at the Palace Hall, to promote their latest tour Tango 3.0, which will begin on April 7. The tour will take in other countries such as Poland, Greece, Bulgaria and Austria. Formed in Paris in 1999, Gotan Project is made up of three musicians of different nationalities: Philippe Cohen Solal (French), Eduardo Makaroff (Argentine) and Christoph H. Muller (Swiss), who collaborate with various musicians both for their albums and
live performances. The band was in Romania last year performing as part of the live album Gotan Project Live. The name of the trio is a play on a famous 1982 tango compilation album, called The Tango Project, which featured several American classical musicians. Gotan Project mixes tango with electronic elements such as samples, beats and breaks. The group’s first issue was Vuelvo Al Sur/El Capitalismo Foraneo in 2000, followed by the album La Revancha del Tango in 2001. In 2006 they released another successful album called Lunatico. Otilia Haraga
Human rights docufest takes place this week Over 30 documentaries will be broadcast in four movie theaters in Bucharest as part of the third One World Romania festival, the only documentary festival in Romania showcasing human rights themes. The event takes place between March 17 and 22. “This year we have been hungry for good films. We have six sections and over 60 movies – very good movies from all over the world,” said Alexandru Solomon, a renowned local documentary maker
who is the artistic director of the festival. The six sections of the event are Global Workers, David vs. Goliath, Square Circles, Training our Memories, Growing Up and Objection, Your Honor! Special guests this year will be the directors Serbian Boris Mitic, Stann Neumann of France and Italian Raffaele Brunetti. The opening will be done in style, with a concert by the band Urma at the Romanian Atheneaeum. Otilia Haraga
Google Ireland holds online advertising seminar at Tourism Fair The Holiday Market International Tourism Fair will include a seminar by representatives of Google Ireland Ltd. The round table, called “Google and the Tourism: the Challenge of Online Advertising and Sales”, will debate the best ways to promote and distribute tourism offers through the internet. The first International Tourism Fair organized by the National Association of Tourism Agencies (ANAT) will take place at the Parliament Palace from March 18-
21. The event will span a surface of 3,500 sqm and will host representatives of the hotel industry, airlines, medical insurance companies, training institutions, tourist offices from various states and local authorities. It will also be attended by officials from Bucharest City Hall and the Ministry of Regional Development and Tourism. Entrance tickets can be purchased online from the site www.biletoo.ro and also on the door. Otilia Haraga BUSINESS REVIEW / March 15 - 21, 2010