BAT plans Bosnia tobacco acquisition | Progresiv
British American Tobacco intends to acquire the tobacco assets of Bosnian holding firm Fabrika Duhana Sarajevo from a regional government in the country, the company said. 
The transaction, being carried out indirectly via a fund, CID Adriatic Investments (CID), is part of attempts by Bosnia's autonomous Bosniak-Croat Federation to plug a hole in its budget by privatizing state-owned enterprises.
Austrian-based CID bought the government's 39.9 percent stake in FDS using financing provided by BAT and said it would make a later bid for the remainder of the company at the same price, also using BAT financing.
"Upon successful completion of CID's takeover offer for the remaining shares of FDS, British American Tobacco will enter into exclusive negotiations for the potential purchase of certain tobacco assets of FDS," BAT said in a statement.
An official involved in the deal said it had been structured so BAT would not need to take possession of FDS's non-tobacco assets, which include banking and real estate operations.
The sale of the government's stake will net it 42.7 million Bosnian marka (24.4 million dollars). CID will later offer the same price of 83.5 marka per share for the remainder of the company.
The remainder of FDS is owned by local subsidiaries of Austria's Raiffeisen Bank and Italy's UniCredit SpA, as well as investment funds and small shareholders.
BAT already owns tobacco plants in Serbia and Croatia.
The deal was hailed by Federation Prime Minister Fadil Novalic as a vindication of the government's privatization strategy, though the largest opposition party SDP said the deal lacked transparency. (www.reuters.com)
