Zagreb-based consulting company Horwath & Horwath has submitted a legal analysis of the privatization and restructuring plan of the Budvanska Rivijera Hotel Group (HG) to the Privatization and Capital Projects Council. The Council will decide on the analysis and next steps for this hotel company at a session, but they did not specify when it will be held.
This was officially told to "Vijesti" by the Government's Council for Privatization and Capital Projects.
The plan for HG “Budvanska rivijera” was proposed at the end of September by “MK group”, which owns 33,58 percent of the shares, through two models. The first option is for the Government and minority shareholders to jointly invest in the state-owned company. The second model envisages the formation of two companies – one in which the state would own the hotels “Palas”, “Castellastva”, “Kristal Palas” and “Mogren”, without the MK group’s share, and the other in which the MK group would be the majority shareholder and the state the minority shareholder, with ownership of the tourist resort “Slovenska plaža” and the hotel “Aleksandar”.
Through this idea, the construction of a new hotel complex with a congress center and a large garage, with a significant share of green areas, through the concept of an open city, is planned on the site of the current tourist resort “Slovenska plaža”. The conceptual design of “MK group” is estimated at 700 million euros, and was developed by the renowned architectural firm “Make Architects”, with headquarters in London and offices in Shanghai and Hong Kong.
In mid-October, the Council decided to submit the initiative to a Croatian advisor for expert analysis before making a final decision, while the people of Zagreb had a month to do so.
"The consultant "Horwath & Horwath consulting Zagreb" submitted to the Council the legal part of the analysis of the initiative for the adoption of the Privatization and Restructuring Plan of HG "Budvanska rivijera", which was submitted to this government body by the company "MK Group". In accordance with the Rules of Procedure, a session of the Council will be scheduled, at which members will be informed of the submitted material and decide on the next steps, of which the public will be informed," the Council said.
They did not respond to "Vijesti"'s questions about what the consultant proposed, when a final decision can be expected, and what the analysis of applicable regulations that they requested from the advisor contains...
While waiting for the Government's decision, the green light for this initiative came from the Municipality of Budva and the first man of that city. Nikola Jovanović, while part of the public protested because they opposed the demolition of "Slovenska plaža".
As "Vijesti" previously wrote, according to the proposed share exchange model, the "Budvanska rivijera" HG would be divided into two companies - one, which would own all the hotels in Petrovac - "Palas", "Castellastva" and "Cristal Palas", as well as the Budva hotel "Mogren" opposite the Old Town, in which the state would be an almost one hundred percent owner, while "MK Group" would not have a share. The second company would be given ownership of the "Slovenska plaža" tourist resort and the "Aleksandar" hotel, with "MK Group" being the majority shareholder, with a rough share of around 60 percent of the share capital, while the state would retain a significant share of 30 percent and the ability to decide on development, with the remaining ten percent becoming minority shareholders.
HG “Budvanska rivijera” manages and operates five hotels - “Palas” in Petrovac (four stars and 171 accommodation units), Tourist Resort “Slovenska plaža” in Budva (three plus and four stars with 1.016 accommodation units), Hotel “Aleksandar” in Budva (four stars, 187 accommodation units), Hotel “Castellastva Petrovac” (four stars, 185 accommodation units), as well as Hotel “Cristal Palas” and Hotel “Mogren” in Budva (three plus stars, 49 accommodation units).
Six years ago, the city hotel "Sveti Stefan" was removed from the company, and its management was entrusted to another government company, "Sveti Stefan Hotels".
"Budvanska rivijera" achieved its best business result in the past three decades last year, and this summer it reconstructed four blocks of the "Slovenska plaža" settlement through an investment worth 14 million euros, while the reconstruction of "Mogren" to five stars was announced in October.
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