The wave of changes on the European banking market caused by the acquisition of German group HVB by Italian bank UniCredito is reaching Bucharest.
The unification of branches in Romania, to which in time will be added the merger of HVB Bank and Banca Tiriac, will create a new bank, ranked fourth on the market with 8.8% market share based on first-quarter data for 2005.
Together, HVB, UniCredit and Banca Tiriac are currently worth nearly 2.5bn euros in terms of assets and together have a network of 108 branches.
Given the size of the transaction (around 20bn euros) between UniCredito and HVB and the schedule for the integration process, the effects will probably hit Romania as late as this autumn. What is known at present is that the headquarters of Central and Eastern European operations will remain in Vienna, from where HVB used to coordinate its subsidiaries in the region through Bank Austria.
At the same time, available information shows that UniCredito''s logo will be expanded to every branch in Central and Eastern Europe held by the consolidated UniCredito-HVB group, with the subsidiaries in Germany and Austria set to retain their current corporate images. The new names have not been set yet.
The process is expected to be handled like a merger in Romania given that the local branch of UniCredito is considerably smaller than that of HVB.
First there is the HVB-Banca Tiriac merger. The contract was scheduled for signing last Wednesday, but lawyers were unable to complete all the necessary procedures by that time. Banking sources say the operation will still be finalised, regardless of HVB''s takeover at the hands of UniCredito. This first consolidation stage will produce HVB Tiriac, which is already the fourth leading player in terms of assets. Once local integration with UniCredit is complete, it is highly unlikely that the Tiriac name will remain on the door of the new bank. It also remains to be seen what the new management structure will look like, as the consolidation represents a major challenge for the current chairmen, Rasvan Radu, Dan Pascariu and Selcuk Saldirak.
Depending on developments on the market while full integration is underway, the bank that results from the merger of UniCredit, HVB and Banca Tiriac may even rank third on the market, given the three banks total assets of around 2.5bn euros, which is close to that of Raiffeisen, the current number three.
Integration will be made relatively easy by the complementarity of the three banks, which is especially true of HVB and Tiriac, which complement each other in respect of their operations: services for corporate customers and retail.
UniCredit is still a corporate bank but its expansion to 35 branches and the launch of products for private customers will bring it closer to this market segment. Beyond the asset value, the consolidation of the three banks will produce a branch network of over 100, providing it with a solid base from which to cover the retail market. The complexity of the construction, however, leaves little room for UniCredito to sustain the financial, management and logistical effort it will need to take over Banca Comerciala Romana if it continues with its plans to participate in the privatisation of what is Romania''s largest bank. This could give rise to a competition problem, with UniCredito accounting for around 35% of the market if it gains BCR.
TITL: Heidi to invest 500,000 euros in chocolate stores
Dana Ciriperu
Heidi Romania, one of the main players on the chocolate market, has achieved a 24% growth in sales for the first four months of the year compared with the same period last year.
The company expects its full-year turnover to exceed 7.8 million euros, an increase of 20% on 2004. "This is a level we set out to achieve based on our investment in some new projects, as well as advertising. Our purpose is to consolidate our position on the market, on the premium segment," said Emilian Cristescu, Heidi''s brand manager.
He estimates a 7% market share for Heidi products. "Our highest growth last year was on the praline segment, which saw 50% higher sales."
The company is due to open its first chocolate shop in Bucharest under the Laderach Chocolatier Suisse brand. The shop will be located in Plaza Romania. "The concept and products belong to Laderach, Heidi''s parent company," he says.
He went on to say that Heidi Romania plans to open another shop in Bucharest by the end of the year. "The business plan for next year involves the opening of 10 more chocolate shops in Bucharest and in the cities around the country that have economic potential."
The investment is estimated at 50,000 euros and the locations being looked at are those with heavy traffic and the potential for profit.
"We will start by selling 45 products - 30 praline and truffles types and 15 maxi fresh chocolate tablets - and will expand the range once we have ascertained the preferences of Romanian consumers," Cristescu added.
The chocolate shop concept is very developed in Switzerland, where Heidi has some 42 such locations. The chocolate shop chain in Switzerland sells more than 300 products, including jelly products and pastries.
"The second half of the year is the most suitable for launches, so we are keeping our surprise for that period," he explained. He says that 2005 is the first year when Heidi will have a special summer edition, its peach-flavoured tablet.
He did not say how much the company was going to invest this year, but said they would focus on expanding production and storage capacity.
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