VMZ-Co Sopot to be privatised

Parliament voted for 100% of the capital of VMZ-Co Sopot, Bulgaria (the former State munitions factory) to be offered for privatisation. Yesterday, at the session of the National Assembly, MPs approved the government's strategy for the sale of the Vazovski Mashinostroitelni Zavodi Co., (Vazov Engineering Plants) with 86 votes in favour, 19 against and 6 abstentions.

The proposal led to a controversy in many parliamentary groups.
Six MPs from the Ataka party (Attack), who attended the plenary hall during the vote, took a stand against the strategy. Four lawmakers from MRF (Movement for Rights and Freedoms) abstained, as well as two MPs from the left-wing party. Another 13 MPs from the Coalition for Bulgaria also opposed the document, while a total of 80 MPs members from GERB attending the hall supported the vote jointly with 6 lawmakers from the Blue Coalition.

According to the Cabinet, the proposal is aimed at the preservation and expansion of the main business activity in terms of both defence and civil production. Some of the deal's objectives cover the modernisation of company production, as well as maintaining it as the major employment factor in the region. A total of 118 million shares will be offered to investors, constituting 100% of the capital under the set public tender procedure for the sale of stocks. The bidders involved in the transaction must accept the terms and conditions stipulating that VMZ-Sopot, Sofia should not be declared insolvent or bankrupt for a period of 5 years from the date of acquisition of ownership of the sold shares.

Pursuant to the strategy, lay-offs of employees will not be allowed for a period of 3 years. Under the terms and conditions for the transfer of shares, potential investors must repay all public liabilities of the engineering plants, as well as the overdue receivables of employees.

The representatives of Siderov's Ataka party and the Opposition demanded greater safeguards for the employment of workers in the factories, as well as the repayment of liabilities by the new investor.