Business Environment Macroeconomic Outlook Capital Market Banking Sector Privatization and Investments Economic Freedom Business News In the Spotlight Coming up...
Privatization and Investments
investments Qatari Diar to Invest €250 Million in Montenegrin Resort Qatari Diar Real Estate Investment Co., part of the Emirates’ sovereign wealth fund, plans to invest €250 million in building a five-star Adriatic resort in Montenegro. Following the takeover of an existing hotel in a bay near the town of Tivat, the company owned by the Qatar Investment Authority will redevelop the 24-hectare (60-acre) site over the next two to twoand-a-half years. This resort will include a luxury hotel, villas and apartments, sports facilities and shopping malls. This is the fourth project that Qatari Diar is building in Europe, and officials have stated that during the first phase, Qatari Diar will invest €42 million in the project. Although the tourism industry in Montenegro is seasonal, Qatari Diar said that it expects the resort to stay open all year round.
Tender for Daily Pobjeda The Bosnian company, Avaz-roto Press, submitted the sole bid received in the tender for an 86% stake in Daily Pobjeda. The offered price for one share is €1 (3,142,950 shares in total). The tender documentation was also purchased by Media Nea, the owner of daily “Dnevne Novine”, but it did not submit an application in the end. Previous tenders for the sale of this company in 2007 and 2008 failed due to its debts. According to the latest data, the company’s total current debt is €10.53 million. The candidate buyer, Sarajevo-based Avaz-roto Press, offers to invest €2.1 million in Pobjeda’s core business during the first three years after it becomes private. It also intends to cut the number of employees to around 170 by 2015.
Montenegro’s EPCG Replacement Project
Launches
€43.5
Million
Electric
Meter
The Montenegrin power utility company, Elektroprivreda Crne Gore (EPCG), launched a €43.5 million project in mid-December, 2011, to replace old electric meters with new multifunctional devices in a bid to reduce losses in electricity and to raise the level of revenue collected from bills. It was planned that approximately 1,000 meters would be replaced in Podgorica by the end of 2011, with a total of 175,000 new devices being introduced over the next three years. The project will be co-financed by a €35 million loan that has been granted by the European Bank for Reconstruction and Development. The EPCG said that the level of power transmission loss in Montenegro is around 18%.
Montenegro to Invest €40 Million in Road Infrastructure in 2012 The Montenegrin Ministry of Transport and Maritime Affairs has announced that it will invest €40 million in road infrastructure projects during 2012. As part of its infrastructure upgrade plans, Montenegro will launch a project to overhaul 13 local roads next year. The Transport Minister, Andrija Lompar, announced that a project plan for this will be drafted in cooperation with the European Bank for Reconstruction and Development (EBRD).
Hilton Hotel Reconstruction Project in Podgorica gets Regulatory Nod The company managing the hotel, Normal Tours recently announced that the oldest hotel in Montenegro, Capital Podgorica Hotel Crna Gora, will be renovated according to the building standards of the hotel chain Hilton. Representatives from the European Bank for Reconstruction and Development and Normal Tours signed the contract regarding the financing of this venture on 11th April, 2011. A year ago, a contract was signed between the “Hilton” Hotel Corporation and "Normal Tours". Under the terms of this agreement the new hotel will have 210 rooms along with all the necessary facilities, and will be based on five star facility standards. The Hilton should be in a position to manage the newly renovated hotel within the next 15 years. The Montenegrin Ministry of Sustainable Development and Tourism has issued the relevant permits for the renovation of a hotel in Podgorica that will reopen under the Hilton brand following a revamp costing €20 million.
14
February 2012
Bulgaria and Montenegro to Cooperate on Energy Montenegro gets Two Bids for Golf Course Projects Project Tender Sofia and Podgorica are considering setting up a joint company for the transfer of electricity to Italy after talks were held in Sofia between the Montenegrin Prime Minister, Igor Lukšić, and Prime Minister, Boyko Borissov. Following the meeting, the head of the Bulgarian government stressed that this venture would give Bulgaria the chance to enter the Italian energy market. Energy was the key subject of the bilateral talks. The Bulgarian National Electricity Company and the Economy and Energy Ministry have been working actively on drafting a long-term contract for the export of electricity to Montenegro. For his part, Borissov reiterated his country’s support for the bid made by the Western Balkan state to obtain EU membership. Montenegro gets €4 million EBRD Loan for Heating System Project The EBRD is helping to improve the energy efficiency of district heating systems in Montenegro with a €4 million loan to finance the construction of a new biomass-fuelled district heating energy system in Pljevlja, in the north-western part of the country. The heating facilities currently in use in Pljevlja are outdated and operate using brown coal. The EBRD loan will be used to convert the obsolete heating facilities in Pljevlja town centre into a ‘stateof-the-art’, centralized district heating system based on biomass.
LPGD, which was founded in Podgorica by Dutch Limon, submitted a better financial offer for the construction of a golf courses in Tivat than PM Golf Development. LPGD put forward a €11.3 million offer for the 90 year lease on Tivat Montepranzo along with a nine-year investment program of up to €181.6 million. It also offered an annual rent of 16 cents per square meter of land; 786,600 square meters were offered for rent by the government. The Tivat-based company, Porto Montenegro Golf Development, founded by Adriatic Marinas, was prepared to pay a total of €10.6 million and offered to pay an annual rent of 15 cents for every square inch of land. PM Golf Development announced a five-year capital investment program worth €10 million.
The total cost of the project cost is set to be € 6.5 million. The balance will be covered by a grant from the EU Western Balkan Investment Framework.
New Tender for Montenegro Steel Factory
Tenders Tender for Orjenski Batalion in Herceg Novi The government of Montenegro announced an invitation for tenders to bid for a long-term lease of 90 years for Orjenski Bataljon Barracks in Kumbor, Herceg Novi, to include both the construction and management of the facility. The tender process is aimed at experienced international investors with a proven financial capacity, along with experience in designing, constructing and operating large multi-purpose tourist resorts. Bids should be submitted no later than March 15, 2012, to the Ministry of Defense, to the Tender Committee for the Valuation of Former Military Property.
Tender for the Mamula Fortress in Herceg Novi The government of Montenegro announced an invitation for tenders to bid for the long-term lease of 30 years, with a possibility to extend up to 90 years, for the tourist resort of Lastavica Island on which is situated Mamula Fortress, Herceg Novi, to include both the construction and management of the facility. The tender process is aimed at experienced international investors with a proven financial capacity, along with experience in designing, constructing and managing complex tourist facilities. Bids should be submitted no later than 14th February, 2012 to the Ministry of Defense, to the Tender Committee for the Valuation of Former Military Property. Note: The regular session of the Privatization and Capital Projects Council was postponed because of the state of emergency declared in Montenegro due to the worst winter weather in decades that grasp the Balkans. For this reason, there is no information regarding the opening of the Bids for the tender for Mamula fortress available yet. •
Montenegro has received two offers for a long-term lease on a plot of land designated for the construction of a golf course. The offers were submitted by the companies Porto Montenegro Golf Development and LPGD Podgorica.
The name of the successful applicant will soon be made public. Limon was the top-ranked company 4 years ago, but the tender committee ended negotiations, claiming that it could not confirm the guarantees that had been put forward to support the investment program which was worth €205 million.
Bankruptcy Committee of the Steel Plant opened new tender for the sale of the whole property of the plant (land, construction facilities, plants and equipment, property that has the status of uncompleted investment, etc.) through public bidding under initial price of 21 million. The bids can be delivered until March 22, 2012. The public bidding will be held on March 26, 2012 at the premises of the Commercial Court in Podgorica. This is the second tender for this plan in this year. The plant went up for a sale under initial price of €30 million. However, Montenegrin Government received no bids following a preliminary call for the sale of insolvent steel mill Zeljezara Niksic. The majority of Niksic Steel Plant shares were transferred to MNSS BV in 2008, when the old company, under the same name, changed its headquarters and ownership structure. Since then, the former industrial giant has witnessed a decrease in the number of workers and an increase in the firm’s debts, the biggest share of which goes to its most recent owner. The bankruptcy of the steel plant, declared in April and confirmed in November 2011, was met with dissatisfaction by the company’s workers. This is the fourth time shares in the Niksic plant have changed hands. Companies from Russia and Great Britain previously held shares.
Sultan Corporation Expects to Re-open Montenegro’s Brskovo Mine The Australian mining company, Sultan Corporation, expects to re-open a disused Montenegrin mine, Brskovo, within four years having verified the existence of zinc, lead, copper and silver deposits. Samples of deposits that were found at Brskovo, in the eastern part of the municipality of Mojkovac, were confirmed following three months of exploratory activities. Exploratory drilling will continue for the next two-three years. Sultan Corporation holds a 25-year exploration and mining lease for the Brskovo lead and zinc complex.
15