Bulgaria Air Group gets greenlight for $9mn bond issuance

Bulgaria Air (FB, Sofia) parent firm Bulgarian Airways Group EAD has been given the go-ahead to issue an ordinary interest-bearing bond to the tune of BGN15 million lev (USD9.1 million), the country’s Financial Supervision Commission (FSC) has said.

According to a prospectus released last week, the seven-year bond will bear an annual interest rate of 3.7%, with interest payments to be made over a six-month period starting on July 19, 2021. Repayment of the principal will start on July 19, 2023, and run through to January 18, 2028.

Proceeds from the bond will be used to help repay BGN5.85 million (USD3.55 million) in bank loans as well as BGN2.20 million (USD1.34 million) in other liabilities. The bulk, BGN6.95 million (USD4.22 million), will be used to finance BAG’s various subsidiaries, which, aside from Bulgaria Air, include the dormant AOC Hemus Air (DU, Sofia), Invest Capital Consult AD (90.00% stake), Airport Consult EOOD, Fly Lease, and Bulgaria Air Technik.

Wholly-owned by Bulgarian conglomerate Chimimport AD, BAG reported a total loss for 2020 of BGN17.6 million (USD10.7 million) on revenue of BGN170 million (USD103.2 million). By comparison, in pre-Covid times, it registered a net profit of BGN3.6 million (USD2.18 million) in 2019.