The first exchangeable bond issue in Bulgaria was successfully realised by UniCredit Markets & Investment banking (through Bayerische Hypo-und Vereinsbank, acting as sole bookrunner on the transaction and UniCredit Bulbank (as local agent)

NOT FOR DISTRIBUTION OR RELEASE IN OR INTO THE UNITED STATES OF AMERICA (OR TO US PERSONS), AUSTRALIA, CANADA, ITALY OR IN ANY OTHER JURISDICTION IN WHICH OFFERS OR SALES WOULD BE PROHIBITED BY APPLICABLE LAW

CHIMIMPORT AD SUCCESSFULLY OPENS BULGARIAN EQUITY-LINKED MARKET WITH PROPOSED ISSUE OF UP TO EUR 80 MN EXCHANGEABLE BONDS DUE 2015

UniCredit Markets & Investment Banking (through Bayerische Hypo- und Vereinsbank), acting as Sole Bookrunner on the transaction and UniCredit Bulbank (as Local Agent) successfully concluded up to EUR 80 mn Exchangeable Bond Issue.

Chimimport AD (“Chimimport” or the “Group”), the second-largest listed company in Bulgaria by market capitalisation, has announced that, with the consent of its Supervisory Board, on 15 August 2008 it has successfully priced and placed EUR 65 million seven-year secured bonds exchangeable for its ordinary shares listed on the Bulgarian Stock Exchange (the “Exchangeable Bonds” or the “Bonds”). At the option of Chimimport, the issue size can be further increased by up to EUR 15 mn at the terms fixed at pricing (as described below).

The Bonds are issued by Chimimport’s wholly-owned finance subsidiary – Chimimport Holland B.V. (the “Issuer”) incorporated in the Netherlands. The Issuer will on-lend the proceeds of the Bonds to Chimimport which intends to use the net proceeds for financing expansion through strategic acquisitions and for general corporate purposes.

11.6 mn existing ordinary shares representing 7.7% of Chimimport’s outstanding share capital held by its majority shareholder, Chimimport Invest AD (“Chimimport Invest”), will be secured for the benefit of the Bondholders pursuant to a share pledge and will be blocked from any dealings. Upon exchange, Chimimport Invest will have the option to deliver cash instead of the underlying shares to mitigate dilution.

Chimimport is the first Bulgarian corporate to offer equity-linked bonds outside Bulgaria. The Exchangeable Bonds provide Chimimport with access to the European capital markets and the expansion of its existing investor base. The transaction also aims to provide flexibility and diversity to Chimimport’s funding mix on terms preferential to those proposed by other financing alternatives.

The Bonds are issued at 100% and, unless previously exchanged, redeemed or repurchased and cancelled, will be redeemed on 22nd August 2015 at 118.9% of the principal amount thereof plus accrued interest. The Bonds carry a fixed 7% annual coupon. The initial exchange price is fixed at BGN 8.449, representing a 30% premium to the reference price established over a 5-day VWAP prior to the pricing date. The Bondholders will have the right to request an early redemption at accreted principal amount plus accrued interest on the 2nd and 4th anniversary of the Bonds. Furthermore, the Issuer will be able to call the outstanding Bonds after 22nd August 2011 if Chimimport’s share price trades at or above 130% of the then prevailing exchange price. The closing of the Bonds is expected on 22nd August.

 

About Chimimport AD

For over 60 years of its existence, Chimimport has transformed itself from a successful foreign trade enterprise specialised in trading in chemical products to a large-scale holding which unites more than 70 companies operating in different sectors of the economy of Bulgaria. The Sofia-based company is an operative holding and its main area of activity is the acquisition of shares, setting up, restructuring and management of subsidiary companies and the financing of group and associated companies. The Group is listed on the Bulgaria Stock Exchange since October 2006 (6C4 BU).

The priority investments of the Group are focused in the following sectors:

* Financial services: Chimimport offers a wide range of financial services covering the full spectrum – banking, non-life insurance, pension insurance, assets management and securitization;

* Transport: The transport sector is of strategic importance within the Group. It is consolidated in several sub-holdings managing activities in aviation, river and sea transport services

o Aviation: Chimimport owns the two major air carriers in the country, including the national flag carrier - Bulgaria Air

o Shipping: Chimimport is the market leader in river shipping operating through Bulgarian River Shipping AD

o Airports, Ports & Ground Services: Chimimport is expanding its position in airports (Varna and Burgas, joint venture with Fraport) and ports concessions (Lesport and Balchik) and sea and river services; Chimimport also provides ground services and MRO operations for aviation (via a joint venture with Lufthansa Technik);

* Industrial Holdings: These holdings include grain and oilseeds trading, vegetable oils and biodiesel production, oil & gas exploration and production and chemicals trading

o Agriculture: Zarneni Hrani Bulgaria AD is market leader in vegetable oil production and its activities include trading and storage of grain crops, trading and storage of oilseeds crops, production and trading with edible oil and development of biodiesel business

o Oil and Gas: Oil and Gas Exploration and Production AD currently operates 12 concessions for drilling of crude oil and natural gas and 3 exploration concessions;

* Real Estate: The Group owns a number of properties including industrial/logistic centres and land plots in key locations in Sofia, Burgas, Varna etc.

Website: http://www.chimimport.bg

This press release is for information purposes only and does not constitute or form part of, and should not be construed as an offer or an invitation to sell, or issue or the solicitation of any offer to buy or subscribe for, any securities. In connection with this transaction there has not been, nor will there be, any public offering of the Bonds. No prospectus will be prepared in connection with the offering of the Bonds. The Bonds may not be offered to the public in any jurisdiction in circumstances which would require the Issuer of the Bonds to prepare or register any prospectus or offering document relating to the Bonds in such jurisdiction. The distribution of this press release and the offer and sale of the Bonds in certain jurisdictions may be restricted by law. Italy has only partially implemented the Prospectus Directive and, accordingly, the provisions of the Prospectus Directive shall apply with respect to Italy only to the extent to which the relevant provisions of the Prospectus Directive have already been implemented in Italy. The Bonds may not be placed, sold or offered to individuals resident in Italy in the primary or in the secondary market. Any persons reading this press release should inform themselves of and observe any such restrictions.

This press release does not constitute an offer to sell or a solicitation of an offer to purchase any securities in the United States. The securities referred to herein (including the Bonds and the shares of Chimimport AD) have not been and will not be registered under the U.S. Securities Act of 1933, as amended (the “Securities Act”) or the laws of any state within the U.S., and may not be offered or sold in the United States or to or for the account or benefit of U.S. persons, except in a transaction not subject to, or pursuant to an applicable exemption from, the registration requirements of the Securities Act or any state securities laws. This press release and the information contained herein may not be distributed or sent into the United States, or in any other jurisdiction in which offers or sales of the securities described herein would be prohibited by applicable laws and should not be distributed to United States persons or publications with a general circulation in the United States. No offering of the Bonds is being made in the United States.

In relation to the United Kingdom this press release is only being distributed to and is only directed at (i) persons who have professional experience in matters relating to investments falling within Article 19(1) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (the “Order”) and (ii) high net worth entities falling within Article 49(2) of the Order and (iii) persons to whom it would otherwise be lawful to distribute it under Section 21 of the Financial Services and Markets Act 2000 (all such persons together being referred to as “relevant persons”). The Bonds are only available to, and any invitation, offer or agreement to subscribe, purchase or otherwise acquire such Bonds will be engaged in only with, relevant persons. Any person who is not a relevant person should not act or rely on this press release or any of its contents.