The requirements for the potential investors in the privatization of Bulgaria's state tobacco giant Bulgartabac Holding practically ban big foreign players from bidding, according to the opposition Socialist party.

"The holding will be sold at a knockdown price and this will only incur losses to the state," Kornelia Ninova, a Socialist member of parliament, said in the town of Blagoevgrad.

According to Ninova eligible bidders are required to process 12,000 tonnes of tobacco annually and produce 35 billion cigarette pieces.

"The big global companies in this sector deal mainly with cigarettes production, rather than tobacco processing. So this makes them immediately not eligible to bid in the tender," she said.

A majority stake - 79,83% - in Bulgaria's state cigarette producer Bulgartabac Holding, whose management has been harshly criticized in recent years, was put on sale on April 26 after years of procrastination.

The long-delayed procedure was officially given the go-ahead by the agency for privatization and post-privatization control through an announcement in the State Gazette on May 10.

The agency invited strategic and financial investors to buy tender documents by June 10. Binding offers have to be filed by the end of August.

The bidder with the highest offer will be selected for buyer. No initial price has been set.

Philip Morris International Inc., Japan Tobacco Inc. And Korea's KT&G are among the potential buyers of Bulgartabac Holding, according to Privatization Agency chief Emil Karanikolov.

Bulgarian cigarette maker King's Tobacco has also confirmed interest in the deal, provided that it meets the set requirements.

Tsvetan Vassilev, head of Bulgaria's Corporate Commercial Bank, which is believed to finance the media group of mogul Irena Krasteva, has also shown interest in the privatization of Bulgartabac Holding.

The buyer of Bulgartabac is expected to be known in September.

The consultant for the Bulgartabac sale, Citigroup Global Markets Ltd, was picked by the Bulgarian government in February 2010.

Two of the less profitable plants of Bulgartabac holding – in the cities of Plovdiv and Stara Zagora – were sold in 2009 through the Sofia Stock Exchange – for BGN 31 M and BGN 18 M respectively.

The holding currently owns the two larger and more consolidated factories in Sofia and Blagoevgrad as well as a number of commercial brands.

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