AIB HAS SOLD its stake in a Bulgarian bank for a mere €100,000 – having paid €216 million for the same stake just three years ago.
The now-state owned bank had paid €216m for a 49.99 per cent stake in the Bulgarian-American Credit Bank (BACB) in early 2008.
In a statement to the Bulgarian Stock Exchange last Friday, though, banking investor Tsvetelina Borislavova said she had bought the stake from AIB for the princely sum of €100,000 – only a tiny fraction of what AIB had paid for it.
The Sofia Echo reported that the low price for the stake was due to the volume of debt that the new owner was taking on. The bank is due to repay €25m of a €75m loan to AIB next month, as well as paying out on €35m of bonds to other investors.
Borislavova’s investment vehicle is now set to loan the bank another €35m to see it through its obligations.
AIB had said last month it had concluded an agreement to sell the stake to Borislavova’s investment vehicle for an undisclosed amount.
Borislavova is the girlfriend of Bulgaria’s current prime minister Boyko Borisov.
Shares in BACB closed down by 1.8 per cent on the Bulgarian Stock Exchange this afternoon, at 0.054 Bulgarian lev (2.76c) each. AIB shares in Dublin were unchanged at 17c each.