The Romanian retail market of household appliances, chiefly its consumer finance component, is still drawing lots of interest from the foreign investment funds. Whereas Flanco is in talks to welcome DBG and Polish Enterprise Fund into the business, Dan Ostahie - owner of retail chain Altex is not idling, either.
Ostahie is now in advanced talks with investment fund AIG New Europe Fund, part of US financial giant AIG, market sources say. Should the negotiations be completed, AIG New Europe Fund will operate a $15-20m capital increase at Altex and will thus come to hold 20-30% in the company, the quoted sources say. The money would be used to support the company's growth.
Altex, which last year posted 115 million euros in sales (according to company officials) is valued at some $45m, close to Flanco's value, according to the above-mentioned sources.
Dan Ostahie would not comment on the information regarding talks with AIG New Europe Fund. "We have discussed with several investment funds so far, since this particular market segment has become increasingly attractive in the past few years," said Dan Ostahie, owner and general manager of the Altex retail chain.
Valeriu Ionescu, representative of AIG New Europe Fund in Romania would not comment on information about the fund's plans to increase the retail chain's capital.
On the other hand, market sources say that negotiations on the capital increase may be wrapped up by April.
Altex, just like Flanco and Domo, has been wooed by many regional and international investment funds, as the three companies are operating in one of the most promising sectors of Romanian economy.
Last year, AIG New Europe Fund, DBG (a fund financed by Deutsche Bank), Polish Enterprise Fund, Advent International and Global Finance were all in talks with the shareholders from Altex, Flanco and Domo, to finance one of the three retail chains.
DBG and Polish Enterprise Fund are now in advanced talks over buying 50% in Flanco from Florin Andronescu (the company's founder) and Danube Fund (a Greek investment fund), according to the latest market data.
All three retail chains have big expansion plans for 2004 and 2005, but will need financing sources to support their ambitious investment programmes.
The investment funds are willing to fork out money to speed up the companies' development, so as to sell them to an international strategic investor afterwards.
According to Ostahie, Altex also has big plans for this year, both in terms of building up its store network and introducing new concepts, which would take a lot of money.
"Our main project for this year is Media Galaxy - a large multimedia store. The first of these stores will be located in the Bucharest Mall and will spread on 3,000 square metres." According to the Altex official, one million euros will be invested in this project, which will be located in the second mall to be built by Turkish group Fiba in the western area of Bucharest - Bucharest Plaza.
Altex officials say the retail chain last year posted 155 million euros in turnover (three times more than in 2002), whereas profit accounted for 5% of turnover.
laurentiu.ispir@zf.ro ; ionut.bonoiu@zf.ro
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