Business Review No.21, June 13 - 19

3Q: Maurizio de Dominicis, customer unit head at Ericsson North Balkans, tells BR that the company’s strategic directions on the market are mobile broadband and machine to machine »page 3

ROMANIA’S PREMIERE BUSINESS WEEKLY

DUTCH INVESTMENT DUTCH FIRMS WERE PIONEERS ON THE LOCAL MARKET BACK IN THE 1990S. BR TALKS TO TODAY’S TOP DUTCH INVESTORS TO SEE WHERE THE NEW OPPORTUNITY IS »PAGE 8-10

June 13 - 19, 2011 / VOLUME 16, NUMBER 21

LINKS

Guy Poupet, president and general manager of BRD-Societe Generale, says the bank kept a tight rein on general expenses in 2010, while making the most of synergies between its business lines. He expects the recovery to begin in earnest in 2012.

Next stop: Silicon Valley The US’s famous IT hub has recently been infiltrated by local firms in the industry.

BR talks to some Romanian players who have made it on this unforgiving market » page 12 FOCUS

Wrapping it up Surfaces matter, say packaging players, who argue that the right presentation can reap rewards. BR looks at the world of wrapping » page 14-15

»page 10-11

ENTREPRENEUR

A beautiful business

RESTAURANT What’s the state of La Union? BR dispatches its restaurant critic to sample the starters, peruse the pasta, pronounce on the platters and grade the grill » page 19

Courtesy of BRD

BANKING ON BETTER TIMES CONCERT Can Bucharest help falling in love with Ali Campbell? The former UB40 frontman is performing at Sala Palatului in support of the charity FARA » page 20

Maria Pauna’s cosmetic salon, Make-up your mind, is doing a makeover on the market, as expansion through the franchise system keeps it sitting pretty » page 18

www.business-review.ro Business Review | June 13 - 19, 2011

NEWS 3

NEWS in brief

3Q Maurizio de Dominicis

WEEK in numbers Photo: Laurentiu Obae

1.4 billion euro – the value of Romanians’ outstanding debts through bank loans in April, according to Central Bank data

Customer Unit Head, Ericsson North Balkans

What is the weight of Romania in the cluster of countries you lead?

It is extremely important because it is the biggest country in the Balkans, with a population of over 22-23 million inhabitants. Our investments are significant.

In the Balkans we have slightly over 1,600 employees, of whom more than 1,200-1,300 are based in Romania. The North Balkans represent a roughly EUR 200 million business for Ericsson, and I have to say that more than 50 percent is coming from Romania. It is the biggest part of our turnover, in terms of people and money.

What activities do you run from the global services center in Romania?

We deliver managed services and we manage networks from our global service center in the Militari district, where we have 800 people working. It is one of the two we have in the world, the other one is in India. It is one of the most advanced of its kind, and revolutionary in terms of the technology we use. We manage more than 35 million subscribers from this center. We do managed services for operators in the UK and Italy, and we manage networks in Spain. Customers are from all over the world.

We started investing in this center in 2006-2007. The investment went into technology such as computers, infrastructure, connections, and then people, which is the biggest investment we have made. The average age of the people working in this center is 27 years old. We have a plan to grow our team in this country, but we cannot disclose it. otilia.haraga@business-review.ro

Photo: Laurentiu Obae

What are Ericsson’s strategic directions on the Romanian market over the next two years?

To give a very short answer, mobile broadband is the latest trend and the one that will lead the internet and machineto-machine. There’s a clear sign that all the operators will go this way, and the investments are in this area. This is where the market is going in Romania today.

We don’t have a specific direction, only one at regional level, for this. This is in line with our strategy and we are preparing to serve our customers, also in this country.

IMAGE of the week Driving in style The second Bucharest Classic Car Show took place last week, bringing together motor enthusiasts interested in vintage models and other auto-related products. Visitors were able to buy or sell a classic vehicle onsite. The location of the show was also the starting and finishing point for the Classic Interbalcanic Rally 2011. The classic car rally will visits the cities of Brasov and Sibiu before returning to Bucharest.

ADMINISTRATION Basescu wants Romania reorganized into eight counties Romanian President Traian Basescu said last week that the government should consider reorganizing the country into eight counties or seven counties plus Bucharest. Since 1968 Romania has had an administrative organization that includes 41 counties, but the president argued that this favors corruption and makes it hard to absorb EU funds.

Basescu also said a new administrative system would eliminate red tape and step up the decentralization process.

Opposition representatives, on the other hand, argued that such a measure would come with huge costs and would only create a new level of bureaucracy.

ONLINE GfK: Only 4 percent of Romanians use internet banking Only 4 percent of Romanians use internet banking, versus 42 percent in the Czech Republic, 34 percent in Austria and 13 percent in Croatia, according to GfK research. From an average of 4.5 activities conducted on the internet, 4.2 are for information, communication and entertainment, with just a small number of users accessing the internet for transactions. While a total of 9.6 million Romanians use banking services, only 4 percent

100 billion euro – the sum earned by Romanians working abroad in the past ten years, according to a survey by the Soros Foundation

1.7 percent – the GDP growth in the first quarter of this year, according to revised data by the National Statistics Institute

check their account through internet banking and 3 percent use the online service. Although the rate of internet penetration in Romania is one of the lowest in the region, it still offers enough ground for digital financial services, especially since mobile phone usage has been growing. The sample of respondents in Romania was 1,000 people, representative at national level for people aged over 15.

year, as the company expanded its number of clients, developed its services portfolio and expanded its staff. Since 2006 Finexpert has gone from having 20 to 60 employees. For the next three years the company plans to increase its turnover to EUR 5 million. To this end it intends to merge with a same-size or micro-company, integrate qualified partners and establish Finexpert franchises internationally.

COMPANIES

EU AFFAIRS

Mechel puts EUR 48.7 million into Ductil Steel complex

Romania’s Schengen accession delayed

Russian company Mechel opened last week a modernized steelmaking complex at its Ductil Steel plant. The main result of the investments made at the Ductil plant was a COSS furnace, using a technology which allows for decreased energy and raw materials consumption and improved steel quality. The COSS furnace can deliver 810,000 tons of raw steel per year.“ This will considerably cut our costs and increase the functioning efficiency of the plants we have in Romania,” said Igor Zyuzin, president of the OAO Mechel board of administration, who was in Romania for the official opening of the investment.

The Justice and Home Affairs Council, which is made up of EU ministers of Justice and Internal Affairs, will discuss Romania’s accession to the Schengen area again in September, after the country and its southern neighbor, Bulgaria, were blocked from joining the passportfree zone. EU interior ministers have acknowledged that Bulgaria and Romania's border controls have met Schengen standards, but a decision regarding entry was delayed due to concerns over their ability to control their borders with nonEU neighbors. The move comes after the European Parliament had voted favorably on the Balkan countries joining the Schengen area. The Schengen cooperation broadens the “free movement” principle by enabling anyone to cross the internal borders without undergoing checks.

Finexpert reports EUR 2 million turnover for 2010 Romanian accounting firm Finexpert has reported a EUR 2 million turnover for last

www.business-review.ro Business Review | June 13 - 19, 2011

4 NEWS MEDICAL INSURANCE

DIPLOMACY

Biogenis Euro adoption, EU expansion excite launches cell British broadsheets on Basescu visit stem insurance product R

larger European Union. That will be 35, maybe by 2018 or 2020 when this process will be finalised.”

President Basescu added that expansion was contingent on EU countries hit by economic crisis. He said: “It will depend very much on how Europe left the crisis period. Because in order to look at the extension we will have to settle the EU’s internal problems, with Greece, Ireland, Portugal and who knows.”

Basescu also met the British prime minister, David Cameron, at his official residence, 10 Downing Street. After the meeting, described by Cameron as “important and productive”, the PM called the two countries “natural partners” and said they had agreed on: boosting their countries’ economies, by “freeing businesses to create jobs – less regulation, more innovation”, extending EU membership to the countries of the Western Balkans, Turkey and Moldova and military efforts in Afghanistan and Libya.

In turn, Basescu called for the EU to be “stronger and united, more competitive and [to] consider research and development as a priority”. He pledged that Romania would meet its military commitments, and its obligations as regards the Europe 2020 strategy. The president added that the two leaders had discussed the two frigates that Romania had bought from Britain.

During his two-day trip, Basescu also delivered a lecture at the prestigious London School of Economics. The hour-long address, given in Romanian, touched on the economic crisis, the dangers of state overintervention in the market, the need for democracy to be sustainable, the bribery of the electorate with benefits and the dangers of populism. A podcast of Basescu’s speech, in both English and Romanian versions, is available at www.lse.ac.uk. ∫ Debbie Stowe

RATINGS

Moody’s keeps Romania’s stable rating

R

ating agency Moody’s is planning to keep Romania’s current stable rating for the next 12 to 18 months, said Peter Vins, general manager of Moody’s Central Europe at the second ICAP Risk Conference.

“For the moment, we have a stable image for Romania,” he said. According to Vins, Romania’s debt rate was stabilizing as well, and while countries in Central and Eastern Europe are in a position to take advantage of the global economic recovery, they will not enjoy as high growth as in previous years.

Among the challenges currently facing European banks, the GM cited the greater uncertainty of systemic support, higher funding costs driving the search for alternative sources of finance, and the increased capital requirements associated with Basel III. Speaking about the major drivers influencing the activity of CEE cor-

Photo: Laurentiu Obae

Courtesy of Biogenis

Anca Babaneata, CEO of Platinum Asigurari, and Cristian Lacraru, marketing and communication director at Biogenis

Photo: Nigel Stead

A

fter Stem Sure and BCR Asigurari premiered Stem Insurance last week, Biogenis, the second biggest stem cell bank on the Romanian market, has launched its own insurance package for stem cell transplants, called Stem Cell. The product has been created in partnership with Platinum Asigurari and Asigest insurance broker and is intended to sell 4,000-5,000 policies by yearend.

Insiders say that the timing of the two similar products reaching the market is coincidental, as the two competitors – Stem Sure and Biogenis – did not know of each other’s intentions. Cristian Lacraru, marketing and communication director at Biogenis, told Business Review that he found out about Stem Sure’s insurance product on the day it was launched. Stem Cell covers up to EUR 200,000 of expenditure on transplants carried out in the European Union and up to EUR 100,000 in Romania, for an annual fee of EUR 120.

The cost of the policy provided by Stem Sure in partnership with BCR Asigurari is EUR 204 per year and it covers treatments costing EUR 100,000, including services for four people – the child, his/her parents and a sibling (which is also the case with Stem Insurance). Stem Cell registered a turnover of EUR 1,500,000 and expects EUR 2,000,000 in 2011. Competitor Cord Blood has had its own insurance system since November 2010, through which the clinic provides EUR185,000 worth of financial support if the child needs treatment abroad.

Anca Babaneata, CEO at Platinum Asigurari, said she expects the medical insurance to sell 7,000-10,000 policies yearly.

The CEO also announced that a new medical insurance product would be launched by yearend. Platinum Asigurari registered a turnover of EUR 4,200,000 in 2009 and expects EUR 6,000,000 this year, having already registered 1.5 million in the first trimester of the year.

In 2010, the health insurance market reached an estimated RON 30.34 million, according to the National Association of Insurers and Reinsurers in Romania (UNSAR).

In the first trimester of 2011, preliminary results showed a nominal growth of over 42 percent against last year, yet there is still room for expansion and for the market to reach its true potential, said UNSAR specialists. ∫ Corina Dumitrescu

omania’s intention to stick to its 2015 target date for adopting the Euro, and the potential expansion of the EU to 35 countries by 2018, were the major themes seized upon by the British media during President Traian Basescu’s visit to the UK last week. Upcoming privatizations and Romania’s Schengen prospects also came under the spotlight in coverage of the two-day trip.

Following an interview with the president, the Financial Times led on Basescu’s statement that Romania was not planBasescu addresses the London School of ning to delay its Euro target dates like othEconomics er countries in the region, which had seen the value of being able to devalue their naRomania’s current economic situation and tional currency in times of crisis to maintain competitiveness. The president told “brutal” attempts to stem the tide. It reported that Romania had “imposed some the paper he had discussed with his govof the toughest austerity measures in the ernment and the central bank (BNR) 27-nation bloc, after letting public spendwhether to postpone the target date. He ing mushroom before the global financial was quoted as saying, “2012 is an election crisis”. The paper also mentioned Romayear, when politicians can get extremely nia’s previously “chronically slow” abgenerous [with public funds] but the peosorption of EU funds and “backward transple will have to pay for that generosity afport network”. However, it noted, “The ter the election… Maintaining the objective [austerity] measures have hit hard the of 2015 for the euro generates the necessary popularity of the president and governdiscipline.” ment – which has survived five no-confiThe FT added that Basescu “said he was dence votes – but markets have praised Rohopeful that Romania and Bulgaria would mania’s determination to rein in its fiwin approval to join the Schengen bordernances. free zone by the end of this year, in spite of Meanwhile, the right-leaning Teleobjections from France and Germany that graph led its coverage on Basescu’s sugmore preparation work is needed.” gestion that the EU could expand from the The paper’s emerging markets blog current 27 to 36 countries by 2018. “We are focused on the imminent round of privalooking at the extension. Maybe it is not the tizations, including minority stakes in right moment in this crisis to discuss but Petrom, Transelectrica, Romgaz, Nuit is clear that both countries are supportclearelectrica and Nuclearelectrica. “We ive for Western Balkans integration, for will sell important percentages on the Moldovan integration, for Turkey intemarket in the largest state-owned comgration,” the president told the paper. He panies, before the end of the year” it quotadded: “These are common points of view ed Basescu as saying. “The money obbetween Bucharest and London. For the tained through these tenders will go into time being we can imagine an EU extenda development fund; it is not destined for ed in Western Balkans, with Moldova and consumption.” with Turkey. We cannot now imagine a The FT was candid in its assessment of

Peter Vins, general manager of Moody’s Central Europe porates, Vins listed the reassessment of business plans, currency volatility and the impact of sovereign ratings development.

Jean-Marie Christophe, VP of D&B Inter-

national Partnerships, also said the currency would remain broadly stable while the external economic risk was low.

Staff

www.business-review.ro Business Review | June 13 - 19, 2011

6 NEWS AUTO

Renault Romania starts partnerships for electric car infrastructure development R Courtesy of Renault

Cannes do: A Renault electric car model was presented in Cannes this year

enault Romania has signed three partnerships to kick start a joint team working on developing infrastructure for electric cars. The first three electromobility agreements were signed between Renault and Siemens, Schneider Electric and Electrica respectively. The first stage involves establishing a team to come up with a complete and viable plan to implement and maintain electric car-powering infrastructure.

Other partnerships of this type are expected to follow in the coming period.

Fabrice Cambolive, general manager of Renault Commercial Roumanie, said that partnerships for the development of electric car infrastructure were a vital part of the company’s business strategy in Ro-

mania. “Developing a network of strong partners, with the same sustainable vision, is a key element in our business strategy in Romania,” he commented.

“Urban transport is continuously changing, and electric cars are becoming a top choice for those driving intensively inside the city,” said Saulo Spaolanse, country president of Schneider Electric Romania. He added that stations for charging electric vehicles can be placed in office buildings, shopping centers, public or residential parking lots.

Together with Nissan, Renault is planning to sell a complete range of electric cars at an accessible price. This year the company is launching three electric models: the Fluence Z.E., Kangoo Z.E. and Twizy, followed by the Zoe in 2012. The carmaker plans to sell 1.5 million electric vehicles worldwide by 2016. From 2015 Renault Nissan will manufacture around 500,000 units per year. At a worldwide level the Renault Nissan alliance has sealed more than 90 partnerships with cities, organizations and key partners to prepare markets and necessary infrastructure for the successful adoption of electric cars.

Worldwide, Renault is offering financial packages designed to make its electric vehicles more affordable, with customers choosing between buying and hiring the vehicle. For the first time, ownership of the vehicle and the batteries will be separate. Customers will take out a subscription that includes the hire of the lithium-ion battery and new mobility services.

The roll-out of various electric car models from different manufacturers comes as the EU is looking to boost customer acceptance of electric vehicles and seeking a harmonized solution for charging them. At the end of March, the EC kicked off a four-year cross-European initiative to promote electromobility called Green eMotion. The project was budgeted at EUR 42 million, of which the EU will contribute as much as EUR 24 million.

A key issue is the development of European processes, standards and IT solutions that allow drivers of electric vehicles easy and seamless access to charging infrastructure and related services throughout the EU. Standardization is another key factor for a fast and cost-efficient European rollout of electromobility. The total number of charging spots within the existing demonstration regions will be more than 10,000, to be installed in Barcelona, Madrid and Malaga, Rome and Pisa, Berlin and Strasbourg.

Another tool employed to spread acceptance of electric vehicles is purchase incentives and tax rebates for customers, and the EC is looking at guidelines for their design and implementation.

Other solutions considered for boosting consumer pull are free parking spaces for electric vehicles, free lanes, access to green zones, and free consumption of electricity for vehicle recharging. ∫ Staff

www.business-review.ro Business Review | June 13 - 19, 2011

INTERVIEW 7

BRD keeps its balance on testing market GUY POUPET, president and general manager of BRD-Groupe Societe Generale, shares with Business Review his take on the current state of the Romanian banking market and outlines the lender’s strategy for the near future. ∫ ANDA SEBESI

ferences between the Romanian market and other very well developed markets.

How would you describe the current situation of the Romanian banking market, and what are its perspectives for this year?

The Romanian banking market is having a pretty difficult time, after a crisis that marked the whole economic environment. The reduced activity on the corporate segment and lower purchasing power of Romanians brought consumption and demand for banking products and services down considerably. Meanwhile lenders have faced delayed installments both from individuals and corporate customers. This put up the cost of risks and dented profits. We hope that once the local economy recovers, banking activity will revert to better levels but it is hard to believe that we will see similar levels as those reached in 2007 and 2008.

How would you characterize BRD-Groupe Societe Generale’s financial performance in 2010?

Our activity evolved satisfactorily last year despite the economic environment being unfavorable. BRD-Groupe Societe Generale posted a net profit of RON 533 million. Looking back, we can say that we took the necessary measures in order to maintain the macro-balances of the bank. General expenses came under strict control while at commercial level we insisted on making the most of synergies between our business lines and managed to compensate partially for the drop in demand.

What will the main components of BRD’s strategy be in 2011?

Our strategy will remain the same. We will continue to launch innovative products, with the majority of them being premieres on the local market. In addition we will continue to create synergies between our business lines in order to come up with integrated offers at competitive prices. But it all depends on the increase in the market’s absorption capacity, which is directly dependent on the recovery of economic growth.

How intensely do you think the effects of the current financial crisis will be felt by the local banking system?

It depends on how rapidly the local economy recovers and to what extent any increase will be manifested in earnings.

There is still a need for investments, new houses and cars and it has to be satisfied.

It is hard to give a diagnosis about the whole banking market but it is likely to see a stronger recovery starting 2012.

How many branches are operational at the moment and what are your plans for the future in this respect?

Our network consists of over 930 units and we think that this can meet the actual needs. However, we are not ruling out the possibility of opening or closing some units depending on the conditions.

What segment of the market – lending or savings – was the most dynamic last year?

From the lending perspective, real estate loans were a dynamic segment of the market, stimulated mainly by the First House program. But I think it is an exaggeration to talk about an increase when the demand for banking products and services was at such a low level.

Generally promotions for credits are enjoying success but the demand must become stable before we talk about increases.

BRD-Groupe Societe Generale has the Restat refinancing loan in its portfolio.

How have your customers responded to it and how do you see the refinancing activity in Romania?

Our promotion has been successful and so we decided to extend it to June 14.

Generally, refinancing is a market that works in such periods of time. The success of this type of product depends mainly on interest. Here what matters is the business strategy of each player to achieve its goals. If we speak about the magnitude of refinancing we can see that many lenders have offers to refinance old credits in their portfolio at the

anda.sebesi@business-review.ro

CV Guy Poupet moment. When the demand for credit gets back to a higher level it is likely that refinancing will no longer be an important issue on the commercial agenda of banking institutions.

The portfolio of BRD-Groupe Societe Generale is structured on clear market segments. How do you think the segmentation of the banking market will evolve in Romania in the coming years?

The segmentation of customers, as a working instrument for lenders to take

into consideration both social-professional categories and the level of earnings that customers have at their disposal. As for now, I think that large universal banks – such as BRD – have adjusted their activity to the specifics of the Romanian market pretty well, and have a complete range of products for all categories of customer. Despite this, there are and will continue to be lenders specialized on a specific niche, focused on specific categories of customers (the liberal professions, wealth management and so on).

From this perspective there are no dif-

A graduate of the Institute of Political Studies in Paris in 1973, and the Public Law faculty at the University of Paris, Poupet, 59, has been working for Societe Generale since 1975, starting his career as controller. The Frenchman has held various top management positions in the group’s subsidiaries in Argentina, Senegal (general manager at Societe Generale de Banque en Senegal), the Czech Republic (vice-president and deputy general manager at Komercni Banka) and Egypt (vice-president and general manager of National Societe Generale Bank).

www.business-review.ro Business Review | June 13 - 19, 2011

8 DUTCH INVESTMENT

reaucracy, the payment of arrears, legal uncertainty and issues related to public procurement continue to be a challenge for the local business environment.

Den Braven seals the deal

Dutch courage helps maintain top slot Investors from the Netherlands were among the pioneering companies that came to Romania as early as the beginning of the nineties, increasing their presence after EU accession in 2007 and now claiming prime position among the country’s top foreign investment sources. Business Review takes a look at the results posted by some of the big Dutch investors in 2010 as well as their future plans. were 3,584 Dutch-capital companies registered in Romania.

Wholesale trade, agriculture, horticulture and the food industry, ship building, transDutch and Austrian companies have been port and logistics, banking, insurance and fighting it out for the top position among financial services, water management and foreign investors to Romania for the past irrigation are the main fields targeted by decade, according to National Bank of Dutch investors so far.

Romania (BNR) data. But while many of As for potential future trends, the Dutch are the investors coming from the Netherlands now focusing on logistics and infrastrucare Dutch-capitalized companies, others ture, water, waste management and energy. are foreign firms registered there due to a friendlier fiscal regime than in other Eu- “Aside from that, there is great potential for the development of the Romanian agriropean countries. food sector. The Netherlands has a lot of exJudging by official statistics from the pertise in this field. We are the second Netherlands Embassy in Bucharest, at the biggest exporter of agri-products worldend of 2010 there were 3,846 Dutch-capwide, while Romania, with the potential to italized companies registered locally, with a total investment value of EUR 5.85 billion, feed 80 million (EU) people, is a net importer. Romania could greatly benefit from making the country number one in the Dutch expertise,” Hans Smaling, counleague table of foreign investors in Romaselor of economic and trade affairs with the nia. At the end of 2009 total investment Netherlands Embassy in Bucharest, told BR. amounted to EUR 4.06 billion and there

∫ SIMONA BAZAVAN

He added that Romania has the potential to become a trade hub for Central and Eastern Europe with the port of Constanta as a gateway.

“There is a need for the development of the port of Constanta and the Danube ports, better navigability on the Danube and investments in water management. In these sectors we are happy with the activities of the two public-private partnerships between the Ministry of Economy from the Netherlands and Dutch companies active in these fields in Romania: the European Gateway Platform and the Netherlands Water Platform respectively.

Their objective is to promote Dutch expertise in Romania and stimulate new investments,” Smaling said.

The empty half of the glass is that many of the issues that hindered Dutch investors, as well as those of other nationalities, a few years ago, still apply. Bu-

A well established Dutch investor on the local market is Den Braven Sealants through its local subsidiary Den Braven Romania.

Since 1997 the company has invested about EUR 25 million locally, approximately EUR 20 million of which went into a local polyurethane foam plant, the group’s only one in Eastern Europe. Another EUR 100,000 was invested in 2010.

The local construction market has fully felt the strain of the recession and 2011 will most likely continue to be a difficult year.

“The growth registered in the first three months is a positive sign, but in my opinion its effects will not be visible across the entire economy until at least five years’ time because there haven’t been any new investments in the last few years and the public’s low purchasing power will not be able to sustain consumption that in its turn would generate healthy economic growth,” Adrian State, general director of Den Braven Romania, told BR. He added that he also believes that the construction market will hit its lowest level in 2011. Nevertheless, Den Braven Romania has reported a EUR 39.5 million turnover for 2010, 28 percent up on the previous year. Officials said growth was possible as the firm had invested in production prior to the beginning of the economic crisis.

The company’s exports reached EUR 19.6 percent in 2010, up 62.7 percent compared to 2009. Sales of polyurethane foams, the company’s main product, rose 65 percent on external markets and by 11 percent in Romania. Den Braven exported to 32 countries, with Poland, Austria, Italy, the Czech Republic and Slovakia its main export destinations.

In Q1 2011 Den Braven Romania reported an EUR 8.1 million turnover, 25 percent up on the same period of the previous year. The results were generated by a 46 percent increase in exports, while local sales hiked 3 percent against the backdrop of bad weather and lack of investment projects. Overall, the company estimates that its turnover will go up by at least 10 percent in 2011.

In the summer of 2010 Den Braven was taken over by two Dutch investment funds, Egeria in partnership with Wagram, which acquired its majority share package. The new shareholders made public at the time that they intended to increase production capacity by investing in the local Den Braven foam plant. The investments are predicted to double the turnover of the Romanian subsidiary over the next couple of years, according to company representatives.

Looking to reap new business opportunities Agriculture is often mentioned with energy as one of the fields that can bring considerable economic growth to Romania in the years to come. An example of a company with such intentions is Sequoia Management, which has announced plans to invest roughly EUR 5 million in the first phase of an agriculture project and another EUR 20 million in biomass with the latter project depending on the approval of the legal framework and legislation for green certificates, Igor Jitta, the company’s managing director, told BR.

continued on page 10

www.business-review.ro Business Review | June 13 - 19, 2011

9

REMCO on top of dynamic market

Jan van Vulpen, General Manager Remco Romania

What are some of the important projects Remco contracted or developed locally?

If we talk about the Remco Group of companies as a whole we have offices in The Netherlands, Romania, Bulgaria, Poland and Ukraine and as such active in these coun-

seen elsewhere in Europe. For our business this means a lot of work.

And we are ready for it!

What segments show the most growth potential/are more interesting to explore?

A recent survey shows that it will take Romania some 24 years to reach 50 percent of the prosperity levels of Western Europe, 37 years to reach 75 percent thereof and 43 years to close the gap. For a businessman in the construction industry this is alike a candyshop as so many things in basically every sector still have to be developed.

On the other hand as friend of the nation and the Romanian people I only wish that by a mixture of mentality change and economic tailwinds these periods will be substantially reduced. The country and the people deserve it, but it only can be achieved by dedicated – and hard working.

ADVERTORIAL

How do you see the segment of industrial constructions unfolding this year?

Apart from the traditional projects in the manufacturing and logistics sectors we are of the opinion that especially the food processing will be picking up in the sense that Romania will be increasingly self supporting in this respect if not further transforming to a food exporting country. That is why we are What are your expectations for launching “REMCOOL”, a series 2011 in terms of new projects of refrigeration - and freeze wareand developments? houses to serve this part of the Quite positive. We see confidence market. returning in the market. Clients and banks increasingly understand the How do you see the potential of enormous growth – and develop- the local market for industrial ment potential in Romania and solutions? conclude that they can not continue Romania simply is a sleeping “crying in the corner” about the mis- giant. It should and will wake up fortune of the last two years. We do some day and returning to more not need words but acts to guide economic activity again in all secthe recovery and that is what we tors of the economy and continue to catch up with prosperity levels do”. tries via our local entities. But apart from that we have a much broader international focus. Our Polish company achieved four contracts in Belarus, the Dutch mother company is active in the Dutch Caribbean with a 4.500 sqm project at Curaçao and a 17.500 sqm on Aruba. But Remco Romania at present is stealing the show with a 21.700 sqm construction in Gabon.

www.business-review.ro Business Review | June 13 - 19, 2011

10 DUTCH INVESTMENT

Courtesy of Den Braven

Braven a new market: Dutch investors like Den Braven were among the first to arrive

continued from page 8 Sequoia is an independent corporate finance advisory and private equity firm, specialized in strategic corporate advisory services and private equity investments with a focus on the Benelux and Romania. The local office was founded by Jitta in 2008.

“In addition to its corporate finance advisory practice, Sequoia is actively looking for direct investment opportunities,” he added. One of Sequoia’s group companies is shareholder of local freight forwarding company IB Cargo which has seen a 20 percent revenue increase last year, according to the MD.

Retail raises problems Heineken Romania, part of the Dutch Heineken Group, was founded in 1998 under the name of Brau Union. The company reported a RON 934 million turnover for 2010, 7 percent up on the previous year. Sales volumes went up by 6 percent, mainly due to the Ciuc Premium and Bucegi brands.

“In 2010 Heineken Romania reported a 7 percent turnover increase compared to 2009, against the local beer market’s downward trend. This performance proves that our long-term strategy of focusing on market share is paying off, although 2010 was a difficult economic and financial year,” said Jan Derck van Karnebeek, general manager of Heineken Romania.

As of April the brewer imports eight more brands from its international portfolio: Amstel, Birra Moretti, Krusovice, Foster’s, Murphy’s, Strongbow, Sol and Desperados.

Other brands in the Heineken portfolio are Ciuc Premium, Golden Brau, Neumarkt, Bucegi, Edelweiss and Zipfer (both imports), Gösser, Schlossgold, Silva, Gambrinus, Harghita and Hategana. It has breweries in Miercurea Ciuc, Targu Mures, Craiova and Constanta, with about 1,100 employees.

The Romanian beer market sank by 3.5 percent last year, falling to a volume of 17 million hectoliters, according to the Brewers of Romania Association.

The economic crisis has made victims of local retailers and one such example is Spar which entered insolvency in 2009.

The local Spar network is operated by Dutch company Spar International. While back in 2008 Spar Romania reported a

turnover of approximately EUR 44 million through 21 local stores, last year its business reached only EUR 10 million. By the end of 2009 the company had closed a third of its units and the remaining network was halved in 2010. “Spar Romania experienced significant difficulties with retail sales falling to EUR 10 million.

Store numbers also decreased from 14 to 7. It is expected that a new Spar structure will be implemented to develop Spar in Romania,” reads the company’s 2010 annual report.

Spar International started operations locally in 2005 with the first store being opened the next year by two local businessmen from Arad under an operating license from Spar International. In 2010, Spar worldwide had retail sales of EUR 29 billion from 12,136 outlets in 33 countries.

The Dutch way of handling money ING Bank, part of the ING Group, was one of the first banks to open a subsidiary in Romania after 1989. Besides the banking wing, ING is present locally through five other divisions, ING Asigurari de Viata, Pensii, Lease, Commercial Finance and Real Estate Investment Management.

In the first quarter of 2010, ING Group reported a EUR 1.38 million net profit compared to EUR 1.23 billion the previous year. The underlying return on equity improved to 14.7 percent. Back in 2009, ING Bank Romania posted a gross profit of RON 84 million, 20 percent down on 2008, and a RON 695 million net income, up 30 percent on the previous year.

On the insurance market ING posted RON 527.1 million gross written premiums in 2009, down 5.4 percent on the previous year.

Dutch Eureko Group is present in Romania through Eureko Asigurari and Eureko Societate de Administrare a Fondurilor de Pensii Private. In 2010, the group’s gross written premiums increased by one percent to reach EUR 19.85 billion. The Dutch group’s net profit was EUR 1.22 billion, down 12 percent compared to the net result reported in 2009 (EUR 1.38 billion). Group assets reached EUR 93.9 billion, up one percent from 2009. The solvency ratio was 220 percent at the end of 2010. Eureko Romania was founded in 1995 as Interamerican Romania and rebranded as Eureko in 2009.

www.business-review.ro Business Review | June 13 - 19, 2011

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Silicon Valley’s Romanians reveal how to make IT big For an IT business, Silicon Valley may be the El Dorado of financing, HR resources and partnerships. If you are not there, you practically don’t exist. However, most SV start-ups will fail in the first few years. So, why should a Romanian entrepreneur go to a place where the chances of success are so low? BR looks over the pros and cons with local pundits who have taken the plunge. ∫ OTILIA HARAGA It’s like in that Frank Sinatra song, “If I can make it there, I’ll make it anywhere.” Silicon Valley is known as the land of startups, and so the rate of bankruptcies is high. “General statistics show that many start-ups will fail before their fifth anniversary. I was reading the other day in an article that Silicon Valley could well be called Failure Valley,” Radu Georgescu, chairman of Gecad Group, tells BR. Others don’t even give them that long.

“Years? More like three days for a business to disappear,” Cristian Nacu, president of South Eastern Europe’s Private Equity Association (SEEPEA), tells BR. “In America, there is a difference in vision. Failure is not seen as a negative, but as a positive.

Even if you failed, this means you tried, had an idea and the determination to push that idea forward,” he says. By contrast, Europe is not so kind towards failure. “In Europe, failure is seen in a negative way. It’s a matter of culture, legislation, and other things that come into play here. But it is important to try to assume risks,” he adds.

Romanians in Silicon Valley “I go to Silicon Valley whenever it is necessary, but I have not moved there,” says Georgescu. Avangate, part of the Gecad Group controlled by Georgescu, is one of the largest producers of applications of the ESD (Electronic Software Delivery) type. Avangate opened its US office in 2007. “Being a software company and not having a presence in the largest software market is like driving with the brakes on,” says Georgescu.

Results were not spectacular at first since the timing almost coincided with the start of the financial crunch on the US market. “Little by little, sales started to grow. The crisis has been over for a long time there and the next boom is already visible, especially in spectacular transactions and stock exchange listings (such as LinkedIn and Skype),” says Georgescu.

Avangate has big expansion plans, especially in the US. The goal is annual revenues of USD 1 billion by 2015 and to list the company on Nasdaq. “There are numerous changes going on that will be announced over the course of this year,” says Georgescu.

Another Romanian company, Netopia System, a supplier of mobile services, was founded in 2008 with a strategy to establish and consolidate a presence in SV. “For a technology and services company, Silicon Valley is the center of the known universe. Through this step, we have

sources an entrepreneur can tap into.

There is an HR pool of better project managers and experts. There are also financial resources, since you can attract more funds. Thirdly, exit possibilities are far more numerous. “In Bucharest, for instance,there is no functional stock exchange. In the States, there is Nasdaq, where a great deal of IT firms are listed.

Europe doesn’t have that many financial markets on which to list a technological company,” says Georgescu.

“Investors are interested in only one thing: profit for the funds in which they have invested, since, in turn, they also attract money from elsewhere. In order to invest, they need to understand that they have in front of them a solid team 3 4 with a perfect project that can bring them a profitability rate in a short time,” says Eram.

It is also true that investors here think big.

“Investments under USD 10 million are pretty much out of the question there, except for angel investors,” says Georgescu.

Networking is the main tool that leads an entrepreneur to investors. “You have to attend events in your industry. First you have to do it at home to meet more and more people who work outside the country, and have an idea how the business is developing elsewhere. Then start going to events in Europe and the United States.

Meanwhile use LinkedIn to the utmost.

And when you can schedule four-five 1. Antonio Eram of Netopia 2. Florin Talpes of BitDefender 3. Radu Georgescu of Gecad meetings a day in Silicon Valley for a week, 4. Cristian Nacu of SEEPEA then book the plane ticket and accommodation and go. I would also recomclearly defined goals in mind. “Silicon Valaccess to both a network of partners and mend finding a mentor who should be faley can be a mirage for entrepreneurs. You potential clients, investment funds and miliar with Silicon Valley, whether Romust know exactly what you want: do global communication channels, which manian or not,” says Georgescu. you need to bring more skills into the is impossible to realize in Romania or Eu“My advice would be: get a visa, buy a team? Do you need to move your decision rope, unfortunately,” Antonio Eram, CEO ticket and go and stay there at least for a center there? Do you wish to provide your of Netopia, tells BR. month. After that, you will be able to own solutions and technologies to poBitDefender, a Romanian producer of better understand how you can tential local partners? Do you want to atsecurity solutions, opened its SV office in achieve success in a global business,” tract investors and start relations with key 2007. At the moment, the team is locatsays Eram. analysts?” says Talpes. “If you have a ed in Santa Clara, close to San Jose, the SV This time might also give a useful idea business that works, a global market tarcapital, where the firm has the base of opabout the drawbacks. “The distance/time get, have a clear strategy that makes the erations for sales and development zone and the money, that’s a fact,” says difference and have sufficient resources teams, “with a focus on integrating BitGeorgescu. “You need some cash, either (a team of two-three good experts there Defender technologies into the solutions of other actors on the global market,” can cost at least USD 1 million a year), from the development of the company or a first financing round, in order to start an says Florin Talpes, CEO of BitDefender. then you can go ahead and open an office. You need money also for the jouroffice there,” he goes on. However, an enney because working at a distance in a 10 trepreneur who dreams of making it Will it make you or break you? hours-different time zone is not very there must have this engraved in mind: “Investors are not the warranty for success; easy,” he notes. it’s one’s own efforts, the will to succeed “Silicon Valley generates huge successes in A Romanian entrepreneur in Silicon online and technology, but at the price of and having a good product/service. If Valley must also adapt to a different eight failures out of ten attempts,” he these exist, success can happen. In 99.99 pace and business culture. adds. percent of cases, those who went to Silicon Valley for financing did not receive anything,” says Eram.

Against all odds: why go to Read a longer version of this article at An entrepreneur thinking of estabsuch a tough market? www.business-review.ro. lishing a presence there must have very Because there is a huge amount of reotilia.haraga@business-review.ro

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www.business-review.ro Business Review | June 13 - 19, 2011

12 LINKS

Media market faces another tough year, growth expected in 2012 This is the third year in a row when the media market has shrunk, with ad spend falling to EUR 316 million, 9 percent below the level of 2009, according to Initiative‘s 2011 Media Fact Book. Figures also suggest that the market will continue its slump this year, dropping to EUR 306 million, while industry insiders hope for green shoots in 2012. ∫ CORINA DUMITRESCU Steve Dallas, managing director at Initiative, shared his view on the market’s continued downfall. “The media market decrease began to temper itself last year, and in 2011 we expect a much lower reduction, of around three percent. Although a lot more advertising space was sold, prices continued to decrease in 2010. All communication channels have been affected and have registered much lower income, except for digital, which, in terms of revenue, is at the same level as print.” The media market is only expected to return to positive territory in 2012, according to Octavian Popescu, Lowe Group vice-president and COO. “Overall, our expectation is that the advertising market will decrease by a small percentage again this year, but with some signs of economic growth appearing and with elections on the horizon next year, we expect it to begin to grow again in 2012.”

TV tops the table This year, TV consolidated its position on a declining market (increasing its share from 65 percent of net spend in 2009 to 66 percent) after a share decrease in 2008. As the crisis continued, television held onto its status as the favored entertainment source, reported the Fact Book.

“Romania remains a media market dominated by television. TV did not suffer as badly as some of the other traditional media in 2010, and increased its share of overall revenue to 66 percent, but with so much choice in terms of the commercial stations available, combined with an increase in viewing and a further small fall in revenue expected this year, prices will remain under deflationary pressure in 2011,” predicted Popescu.

CME kept its leading position, followed by Intact Group, both in terms of ratings and also sold GRP. These were followed by Realitatea-Catavencu, the public broadcaster’s main station (TVR1) and Dogan Media.

Print press sees the writing on the digital wall In line with the trend of 2009, the print market continued to suffer from lower advertising outlay and readership, forcing publishers to implement more anticrisis solutions listed in the Media Fact Book as changing the frequency of publication, massive image changes, promotional offers when buying certain titles and so on, all in an effort to survive.

Compared to the significant 35 per-

cent decrease in reported advertising revenues in 2009, 2010 only brought a 4 percent decrease.

But while the print press has put a brake on its declining trend in terms of budget, due to the anti-crisis measures taken in 2010 (higher discounts, decreased rate cards, bundled offerings, increased share for barter and so on) the net figures are expected to continue decreasing.

Another noticeable effect is the percentage of advertising expenditure moving from newspapers to magazines. In 2009, the ratio was 53 percent versus 47 percent in favor of newspapers while in 2010 it reached 50:50.

Internet grows alone in 2011 The internet reached EUR 26 million in ad spend in 2010, compared to EUR 19 million the year before, and the figure is predicted to grow even further, to EUR 34 million in 2011. However, advertising through this medium is in continuous flux, said Popescu. “The way internet advertising is used by clients is rapidly evolving; it is no longer just about classic display advertising on websites. As the online market continues to develop and mature, the way people are using the internet is changing. This can be witnessed in the explosion of social media in Romania: Facebook now has over 3.2 million Romanian users and the rate of growth shows no sign of slowing down.”

The Media Fact Book reports that internet consumption in Romania is widespread among people over 30, with more than 50 percent of internet users fitting into this category. This is however regarded as typical for emerging markets and similar breakdowns can be found in Asia and Latin America. Specialists expect the maturing trend to continue.In the latest report on the status of the telecommunications market published

by ANCOM (the National Association for Communications) in June 2010 and quoted by the Media Fact Book, Romania has a total of 6.25 million broadband connections nationally, up 23 percent against last year.

The increase is thought to be driven largely by mobile connections (mobile internet and smartphones), which now stand at 3.32 million connections, a 36.6 percent increase from June 2009.

According to Media Fact Book experts, 2010 was the year that saw the “rise of smartphones”, as well as the year when mobile marketing became dissociated from just SMS marketing. In 2010, one out of ten mobile phones sold by operators in Romania was a smartphone. This led to a penetration rate for smartphones of nearly 11 percent of total mobile phones.

Some 70 percent of all online marketing budgets is estimated to be spent on awareness campaigns, both traditional or innovative formats. Search Engine Marketing (SEM) continues to grow to 23 percent of ad spend, and social media and others around 7 percent, according to Initiative data.

Increasing internet to herald toppling of television?

In 2011, Initiative expects that TV will slightly decrease its share of the total net market to 65 percent and the internet will become the second most important medium on the market, with 11 percent.

The total net ad spend is projected to decrease at a much lower rate than in 2010, with an overall drop of just three percent.

Quoted in this year’s edition of the Media Fact Book, Lucian Croitoru, adviser to the Governor of the National Bank of Romania, stated that “positive growth rates in Q4 2010 and Q1 2011 suggest that the recession is over”,

TOTAL NET AD-SPEND BY MEDIUM (MILLION EURO) – ESTIMATE* Medium TV

2008

2009

2010

2011-estimated

Market shares in 2010

337

222

209

198

66.2 %

Print

82

37

26

24

8.2 %

Radio

35

25

21

20

6.7 %

OOH

70

42

33

30

10.6 %

Internet

16

19

26

34

8.3 %

Total mln Euro

540

345

316

306

-

*according to the Media Fact Book Romania 2011, launched by Initiative

which may also suggest a recovery of the media market.

corina.dumitrescu@business-review.ro

TOP 10 ADVERTISERS* Procter & Gamble: EUR 658,925,194 Kraft Foods: EUR 287,696,944 Reckitt Benckiser: EUR 259,624,960 Orange: EUR 241,910,441 Henkel: EUR 216,493,862 Vodafone: EUR 203,366,305 Unilever: EUR 185,924,427 Danone: EUR 184,669,833 : EUR 169,134,536 Ferrero: EUR 167,148,569 *according to the Media Fact Book Romania 2011, launched by Initiative

TOP INVESTORS IN 2010, ACCORDING TO RATE CARD BUDGET* Medical & optical products & services: EUR 622,870,190 Mobile telecommunications services: EUR 545,767,434 Dairy products: EUR 381,009,052 Detergents: EUR 346,726,750 Toiletries: EUR 340,879,275 Haircare: EUR 321,244,923 Other sugar, confectionary, honey: EUR 314,851,668 Banking & insurance services: EUR 306,575,867 Cosmetics: EUR 294,222,426 Household cleaning products: EUR 287,400,033 Medical & optical products & services: 55% Mobile telecommunications services: 11% Dairy products: 16% Detergents : 40% Toiletries : 13% Hair are: 20% Other sugar, confectionary, honey: 51% Banking & insurance services: 13% Cosmetics: 6% Household cleaning products: 26% *according to the Media Fact Book Romania 2011, launched by Initiative

www.business-review.ro Business Review | June 13 - 19, 2011

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Academia Catavencu title up for auction again The future of the Academia Catavencu title, one of the most long-standing and distinctive mass media voices in Romania, is still hanging in the balance, after editorial manager Doru Buscu, who won the recent auction for the paper’s ownership, announced he did not manage to raise the required EUR 1.6 million to pay for it. ∫ OTILIA HARAGA

Photo: Laurentiu Obae

At the end of May, a public auction was held to decide the fate of the brand after Catavencu SA went bankrupt. From a starting price of almost EUR 150,000, not including VAT, bids sky-rocketed to over EUR 1.3 million without VAT, in excess of EUR 1.6 million in total.

“The high price is the result of competition during the bidding,” said Petrisor Obae, editor of paginademedia.ro. The two bidders who raised the stakes during the auction were Doru Buscu, co-founder of the satirical publication, and Dan Grigore Adamescu, the businessman who owns Romania Libera and wanted to add the brand to his portfolio of titles.

“The large sum was of no use to anybody because the money was not paid and the bidding will re-start next week,” said Obae.

According to Obae, journalist Sabina Fati, representing Adamescu, joined in the bidding for the simple reason that she met the bidder’s profile as defined in the task book, which stipulated experience in the written national press.

However, “this was done to keep up

Satire for sale: highly reputed Academia Catavencu pokes fun at the powerful appearances because the real bidder for Adamescu was a lawyer. We shall see in the next auction how far they are willing to go with the price,” he added.

The new auction will take place on June 14, and Buscu has announced that

he will take part again, even though he lost the EUR 45,000 that he had paid as warranty in the first auction.

“Since the winner, Doru Buscu, did not manage to raise the money but will participate again in the next auction, we can

deduce that expectations are that the price will be lower,” said Obae.

Contacted by Business Review, Buscu did not comment on this issue prior to press time.

However, the editorial manager previously said that his involvement in the auction was done “in self defense” as he wanted to ensure the brand remained independent.

“The Academia Catavencu brand is still very strong and can still generate revenues given an efficient management,” said Obae.

When asked about what goes into the value of a press title in Romania, Obae said: “The power of a brand comes from many factors, including credibility, trust, position and capacity to succeed on the market and to ‘remain imprinted’ in the mind of the readership. These are things that can also continue with another owner and another firm,” he said.

He added “It is hard to imagine Academia Catavencu without the Academia Catavencu team, but even if the brand passes to Adamescu, it can go forward.

Better or worse, more or less successfully,” he concluded.

www.business-review.ro Business Review | June 13 - 19, 2011

14 FOCUS

Packaging packs a punch Some international brand packaging agencies are considering making Romania the head office for their other regional subsidiaries. The local brand packaging market is, however, only at the start, and with an estimated value of just EUR 2.5 million, experts say there is still room for growth. Current packaging trends see the market divided between international brands that maintain globally unique packaging and specifically Romanian products.

∫ CORINA DUMITRESCU

Photo: Laurentiu Obae

There are an estimated 10-12 packaging design players on the local market, of which only six are “specialized and dedicated” agencies, says Simona Straut, managing director of Cocoon Group Bucharest. To Straut, although the market has significant potential for growth, it will be years before it actually reaches its true value. “The packaging design market in Romanian is still at the beginning, not yet well developed, and there is still room for growth and for more professionalism. The issue remains the fact that professional local agencies are very few compared to the market needs. Plus, clients are still learning, they are working a lot with advertising agencies in this area or with freelancers.” As Straut added, in spite of the crisis and the current negativism, there is room for expansion for the agency - “we’d like to run other countries in the region from the Bucharest office”.

Pursuing a career in this area puts a lot of emphasis on professional background.

“You need at least five-seven years of work experience to be considered a good packaging designer. This is a huge time investment from one person and few are willing to make it. You need passion, patience and knowledge to achieve this experience and that is why this job is not so glamorous for many people compared Leader of the packaging: the right style of packaging can boost sales, say industry players to other options from the creative industry, such as basic advertising,” adds Straut. can see local promotions featured on The costs of a package design project products usually have three-four lanthe packaging, but still respecting the can start from EUR 8,000 and reach guages on their packaging no matter (global) master design, thus keeping the sums in the region of EUR 25,000, dewhere the production factory is located unity and consistency of the brand. Durpending on the complexity, estimates (Romania or elsewhere), but certainly, ing the past two-three years we have Andreea Florea of Brandtailors. In terms those are the languages from the region noticed that international brands have of market value, Straut puts the current they are active in,” says Straut. She adds, been trying to simplify and unify their figure at around EUR 2.5 million. Florea “What should be locally specific is the brand portfolio and packaging design says it is difficult to give an accurate esstrategy and brand positioning.” around the globe, resulting in master timate, but sees brand packaging as curOffering a regional perspective, Mick designs that are similar in many countries.” rently representing “35-40 percent of Cassel, brand development director at CoPaul Markovits, marketing director at the local branding industry, which we escoon Group, continues Straut’s idea. “In Heineken Romania, offers the perspective timated at about EUR 3.5 million for the case of international lifestyle brands, of an international brand seeking to conboth 2009 and 2010.” it is not in their long-term interest to acsolidate its position on the local market. commodate localization because their “As compared to a local brand, for global very rationale is that they bring to each Local or global? brands the most important aspect is to be market international offers and lifestyles.

It is rare for international brands to adapt aligned and consistent everywhere. Any So, only if there were something terribly their packaging to the local market, exSimona Straut, managing director adaptation will be in line with what the wrong – for example if their brand name perts say. “International brands that are Cocoon Group Bucharest consumers expect from the brand. For exmeant something rude in a certain lanimported tend to only apply the labeling ample, this year, the Heineken UEFA guage – would a change be necessary. law according to Romanian market ternational trend. Therefore there should Champions League was adapted to reflect specifics and local regulatory affairs. Otherwise, it would be contrary to what be a mix of local and international the fact that this year’s final was at Wemthey want to achieve.” As he adds, the use There are very few cases when the inelements, colors, look and feel, bley Stadium in London, also known as of an international language in a brand’s ternational brands that are sold in Roopening mechanism and materials,” The Temple of Football.” communication takes the targeted cusmania make specific claims for the local The situation is, however, different for argues Roland Kunst, owner of Die Kuntomer to a different place, another “brand market (e.g. ‘no preservatives’, ‘no added the domestic brands in the Heineken stfabrik. world”. sugar’, etc.). The most common is to Irina Ilie, associate director at Bran- portfolio. “The packaging of these brands However, not everyone agrees. add ‘new’/ ‘nou’ on the pack in the local country’s language when it is a new “Brands must adapt to local customers’ dient, has noticed an international trend reflects the personality of the brand and, of simplifying packaging, that is also vis- at the same time, responds to consumers’ tastes and likes, yet always need to be product. As you can see by glancing at suible in Romania. “From time to time, we requests. Some examples are: the ring ahead of the market and reflect the inpermarket shelves, the international Courtesy of Cocoon Group

www.business-review.ro Business Review | June 13 - 19, 2011

Courtesy of Dufa

aging can boost sales,” he adds.

Products on the local market also need to constantly reinvent themselves in order to keep up with the ever-changing trends.

Florea from Brandtailors argues, “There is no recipe regarding the right period of time after which a package design needs to be replaced – one solution can prove to be appropriate for more than ten years in a stable category, but another may need to be changed every two or three years in a constantly evolving market context. An interesting phenomenon that we sometimes witness is the change of a visual paradigm across entire categories – when a powerful global player or a daring challenger brand enters a Nicoleta Eftimiu, senior marketing Liviu Stan, managing partner at paint market, it creates a domino effect and manager, Coca-Cola Romania producer Dufa spreads change across the whole category.

In these cases, it is very important that the established brands react to the change in cepts in different markets. Generally, buy a product or not. Romanians enjoys terms of package design and keep up with heritage brands or long established trying many brands, and consider all of the pace, because it is very difficult for a brands are more resistant to changing them of mediocre quality. (…) They readbrand that is left behind to recover if it is their package design, both over time and ily combine a French perfume with secfrom one country to another, while ond-hand clothes, or eat Romanian ‘mici’ not appropriately rejuvenated in due time.” younger or more modern brands are with a side of Belgian beer. They are not Pavel says he has observed that locally, open to these types of changes,” conthat fond of labels, but do not hesitate to cludes Florea. show off when given the opportunity.” international brands are losing ground to national ones. “Driving this trend is the Counterintuitively, Pavel adds, “Romapublic’s loss of faith in products whose nians put more value on a Romanian Local trends in brand marketing has nothing to do with Roproduct of questionable quality, than on packaging manian consumer culture. Most of the a sophisticated product.”

So what types of packaging catch the eye time, the country’s major agencies transLiviu Stan, managing partner at paint of the local consumer? Dan Pavel, creative late the communication type from the producer Dufa, says that the best packdirector at Brandart, says, “Romanians are aging in his field has some requirements. Western world, without a true interest in emotional and have a pronounced Latin Romanian psychology. The result is a “In retail, packaging with light-colored lacharacter. decrease in the level of consumer confiThey respond positively to the new, bels that offer clear information on the dence and sub-par sales.” but are not faithful to a certain brand. use and quality of the product is the best. More importantly, the brand needs Quality is considered an ideal; it’s price to be very visible. Well-done brand packthat determines whether they choose to corina.dumitrescu@business-review.ro Courtesy of Coca-Cola

pull for the Ciuc Premium bottle, the shape of the PET packaging, the shape and colors of the bottles and the type and size of the pack are related to the key strategic channels that must fit with the key driver of beer consumption etc.” It is, in fact, these local brands that generate a significant part of the company’s profit.

“During 2010, the volume of Heineken Romania was up 6 percent compared to 2009. The growth was especially driven by the Ciuc Premium and Bucegi brands and shows that the company’s strategy to permanently support and invest in its brands has brought results,” continues Markovits.

Nicoleta Eftimiu, senior marketing manager for Romania and Moldova in sparkling soft drinks at Coca-Cola Romania, an acknowledged leader in global branding, believes, however, that for her company the most important aspect is for “the package to reflect the brand identity. Evidently, the choice of type and dimensions for the package will be in accordance with the brand, the local needs of consumers, as well as the local regulations.” As a FMCG brand, Coca-Cola both locally and internationally prints its label information very visibly for consumers to be able to make informed decision about their daily diet.

All in all, “in the case of international brands, adapting the package design according to local specifics is not a matter of right or wrong – it depends very much on the brand characteristics and extension strategy. For example, Coca-Cola takes a more consistent global approach to package design, whereas the 7Up brand has different package design con-

FOCUS 15

www.business-review.ro Business Review | June 13 - 19, 2011

16

Market looking more star-spangled to US firms The predominant tone was more optimistic at the third American Business Forum organized by BR last week, after some of the improvements that US companies have been advocating for some time, such as the new PPP law and Labor Code, were eventually approved by the authorities. While stressing the importance of certain details that need to be settled in their respective domains, American investors see the future more brightly. ∫ STAFF

Blair LaBarge economic counsellor with the US Embassy “Everyone seems to agree with the IMF and private sector forecasters that the economy is recovering and will continue to improve.”

Nadia Crisan managing director McGuire Woods Romania “Infrastructure is the key area for Ford and for all investors. It’s difficult to project the future of the business in its absence.”

300,000 units per year up from 100,000 units, Nenzen said, adding that the new registration tax will help boost sales of new cars.

Putting the recession aside, 2010 brought some good news for local foreign investors. “Looking at the big picture, the public-private-partnership (PPP) law that was passed and the reforms of the Labor Code are good things, ” said Perry Zizzi, partner at Clifford Chance Badea. However, particularly in the PPP law, amendments would be needed. “We would like to see the possibility of public institutions being not only able to put in assets but also cash, ” he continued.

Attendees agreed that progress has been made in the past few years in Romania and pension reform stands as proof of Perry Zizzi partner at Clifford Chance Badea “Looking at the big picture, the publicprivate-partnership (PPP) law that was passed and the reforms of the Labor Code are good things.”

Dan Schwartz managing partner of Scot & Company “If the project directive for a common consolidated corporate tax base is adopted, it will be a great step forward for the business community.”

services for the global market should be our focus,” he said. Switching from running infrastructure and platforms in house to acquiring them as a service is a growing trend for the companies that need to upgrade their current infrastructure or just need to run a predictable, cost-effective IT environment. The cloud computing movement is a big enabler in this area. Cloud services are growing on the local market, but still lagging a bit behind other EU countries, said Manac.

The third edition of the American Business Forum was held last week at JW Marriott Grand Hotel and was attended by 110 participants. The event was sponsored by Fine Law Patrascanu & Associates, Horvath & Partners, Clifford Chance Badea and Scot & Company.

this. “Pension reform in Romania is one of the few successful reforms that have ever been made in Romania. At the moment, in 2011, there are 5.29 million participants in it,” said Mihai Coca-Cozma, president of the board of directors and GM of Alico Pensions.

The assets total EUR 1 billion, “which is basically 1 percent of the Romanian GDP,” he added. The market was very aggressive and very competitive: it started with 14 administrators and now there are only 9 on the market. “As an American company, we have a great advantage because the authorities are more open to listening to us,” concluded Cozma.

In a post-event interview with BR, Dragos Manac, CEO of Appnor MSP, pronounced the IT domain a leading sector in the Romanian economy. “Niche, high-margin Alexandra Gatej president of AmCham

Henrik Nenzen managing director of Ford Romania

“In America if you ask an investor or a think tank member about Romania, they will say that Romania equals two things, energy plus agriculture.”

“We are optimistic because the market in Romania – at 100,000 units per year presently – should be 300,000 units.”

Mihai Coca-Cozma GM of Alico Pensions “Pension reform is one of the few successful reforms that have ever been made in Romania.”

Dragos Manac CEO of Appnor MSP All photos: Laurentiu Obae

“The last two times that Business Review held this event, in 2009 and 2010, it was difficult to be optimistic – because in June 2009 things were continuing to get worse very quickly and in June 2010 everyone’s consensus was that Romania would bottom out but things might get a little worse before they got better,” said Blair Labarge economic counselor with the US Embassy. He went on to say that now everyone seems to agree with the IMF and private sector forecasters that the economy is gradually recovering and continuing to improve. He warned, however, that as Romania is approaching an election year, the challenge will be to continue with the structural reforms and not to fall into the trap of populist measures.

Also present at the event, Alexandra Gatej, president of AmCham, which numbers 300 member companies that have invested over EUR 10 billion locally, said that this year the organization would concentrate its efforts on promoting the need to increase the competitiveness of the Romanian economy.

Good news from Brussels said Dan Schwartz, managing partner at Scot & Company, who talked about a project for an EU directive on the common consolidated corporate tax base. If adopted, it will bring a ‘one stop shop’ approach by applying a single set of tax rules and allow businesses to deal with only one tax administration regime at EU level.

One of the most notable American investors in Romania is Ford. Sales of new vehicles have plummeted in the past couple of years but Henrik Nenzen, managing director of Ford Romania, said the company was optimistic regarding the future. The market for new vehicles could reach

“Selling the labor itself does not scale, especially in a rather small country. Niche, highmargin services for the global market should be our focus”

www.business-review.ro Business Review | June 13 - 19, 2011

PROPERTY 17

America House renews contracts for over 30 percent of office space Courtesy of Colosseum

Mall on course: the first phase of Colosseum is due to open this fall

Colosseum to open retail park phase this fall The first phase of Colosseum, the retail development of Nova Imobiliare, will open this autumn. The retail park, whose construction is being financed by the Bank of Cyprus, will host tenants such as the first Leroy Merlin store in Romania, electronics retailer Altex and a Carrefour hypermarket. ∫ STAFF

low shortly, the retail mix in the office block includes local and international brands such as Starbucks, Top Clean, Credit Europe Bank, BCR, HelpNet and Samsonite.

“Headline rent for office premises in America House is following the market trend in CBD and reaches on average EUR 19/sqm. We are very happy with and proud about all the renewals and new leases signed within the last six months which amount to 8,000 sqm. This is confirmation that America House is a true landmark building and an attractive destination for large international companies.” commented Emmanuel Gluntz, asset management for Central Europe director, AEW Europe.

DTZ Echinox acts as leasing agent for the available office space in America House. The building currently has two available floors of 1,700 sqm each; however, the landlord is in advanced negotiations for the lease of one of them. ∫ Staff

Sonae Sierra starts work on its first local mall

Courtesy of Sonae Sierra

The EUR 350 million Colosseum development constitutes a total of 190,000 sqm covered shopping mall and a stand alone retail park, with more than 480 shops and over 10,000 parking spaces, constructed on a site of over 600,000 sqm in the Chitila area, northwest Bucharest. The investment is predicted to provide over 5,000 jobs.

The second phase of the project consists of a shopping mall containing 480 stores within a leased area of 137,000 sqm.

The mall will feature a marble food court, a 12-screen cinema, 20-lane bowling alley, restaurants and three shopping boulevards: Via Milano, hosting the most popular brands, Corso Capri, targeting fashion conscious teenagers and young people, and Bellini Boulevard, a luxury avenue dedicated to exclusive names.

Its opening is scheduled for 2013. Of over 10,000 parking spaces, 8,000 will be covered.

Two more lanes and two underpasses will be added to the main road (Sos. Chitilei) passing in front of the facility.

The Colosseum is being developed by Nova Imobiliare, a Romanian company established by British businessmen. Panico Panayi, president of the firm, described the positioning of the project as premium, in the context of a return of customers’ preference for luxury retail.

“The economic crisis is fading away and luxury retail is coming back. The difference this time is that you can’t just slap a logo on something and expect it to sell.

If a brand and its services or products are well considered, well crafted, designed to last, have a story to tell and are presented in a stunning physical space then consumers will connect,” he said Shoppers are becoming more mature – and ethical, added the president.

“Customers are starting to demand that retailers not only offer value but also advocate values like environmental and social responsibility. It’s all part of a more sophisticated understanding of what ‘value’ really means. Recent studies show that consumers are becoming less sensitive to price, and looking for more quality and for retail that’s a little less selfish. The Colosseum will be a lot more than just another mall offering expensive goods: it will provide jobs, it will increase the desirability of the Chitila area, thus providing its residents with a new perspective on what urban comfort means,” Panayi predicted.

The architecture firm for the project is Leach Rhodes Walker, which has offices in Manchester and Bucharest, while the interior design architects are the American-based Darrell Schmitt Design Associates, specializing in luxury resort and hotel design around the world. The project and cost manager is Gardiner & Theobald.

Other retail projects expected to be delivered this year include the Maritimo Shopping Center in Constanta, Palas in Iasi, and Baneasa Shopping City’s extension in Bucharest. The first retail delivery of the year was the Promenada Mall extension in Braila, with a 7,000 sqm GLA.

AEW has recently renewed lease agreements for over 30 percent of the office surface area in the office building America House, for periods of up to eight years. S&T, the provider of IT services in CEE, has renewed the agreement for 3,000 sqm for another eight years. Tuca Zbarcea & Asociatii law firm, which occupies 2,200 sqm, has extended its contract for another five years. Other companies such as Ericsson, Mastercard and Cisco have also renewed their leasing agreements for periods of three to five years.

On the retail and leisure segment, America House is accommodating two new restaurants: Fitto Café, which has taken up a 120-sqm area for a five-year interval, and Be Nat, part of the Oliviers & Co Group, operating on the former premises of French Bakery, on the ground and first floors. Both restaurants serve organic food.

Oliviers will open its America House outlet, its second in Bucharest, this fall.

With the recent openings and more to fol-

More in store: Adora Mall is set to host nearly 200 shops Shopping center developer, manager and owner Sonae Sierra has announced that works have started at its first local shopping mall in Craiova, south Romania.

The Adora Mall, which will require an investment of EUR 111 million, will have a leasable area of 59,000 sqm and 190 shops.

“Starting work on Adora Mall confirms Sonae Sierra’s commitment to the Romanian market and the Craiova market.

The first phase of the construction process will take six months and we are confident that we will then be able to announce a deadline for completing the project,” said Ingo Nissen, managing director for Sonae Sierra in Romania.

About 40 percent of the future shop-

ping mall has been leased to companies such as Altex, Cora, Cinema City, Orsay, Inmedio, Arsis, Total Wash, Sport’s Pub, Maxbet Best of Bowling and Pure Fitness.

Another 20 percent of the total leasable area is presently in an advanced negotiation process, according to company representatives.

Sonae Sierra entered the local market in 2007 by purchasing the River Plaza mall in Ramnicu-Valcea. Adora Mall in Craiova will be its first greenfield project. Another mall presently under construction in Craiova is Electroputere Parc, a EUR 90 million investment which is being developed by K&S Developments and Auchan. ∫ Simona Bazavan

www.business-review.ro Business Review | June 13 - 19, 2011

18 ENTREPRENEUR

A Mind for the beauty business Drawing on her experience working for L’Oreal Romania, businesswoman MARIA PAUNA decided that setting up her own salon, Make-up your mind, was “worth it” and underwent a makeover from employee to entrepreneur.

Becoming the sole importer of Biotouch for Romania, Bulgaria and Republic of Moldova has put gloss on her venture, and she’s now extending her business after spotting the beauty of the franchise system. ∫ ANDA SEBESI

COMPANY PROFILE Make-up your mind Number of employees: 6-10 2010 estimated turnover: EUR 200,000 2011 estimated turnover: EUR 400,000 Initial investment: EUR 70,000

Photo: Laurentiu Obae

Maria Pauna’s career played a crucial role in her decision to set up her own business, the beauty salon Make-up your mind. She graduated from the Faculty of Medicine in 1999 and soon after that started to work for a multinational company, L’Oreal Romania.

The businesswoman gained a lot of experience working in several of the firm’s departments and had the chance to take courses at the Make-up Forever Academy, one of the most famous makeup schools in Europe.

“I became official make-up trainer for L’Oreal and that was the beginning of my future career as a trainer and beauty coach,” says Pauna, owner of Make-up your mind.

In 2004 she launched a make-up and eyebrow studio as part of a beauty salon, the first woman to make that step on the Romanian market at that time. In addition the entrepreneur started an educational campaign with L’Oreal Romania that helped her understand the beauty market and its needs.

In the meantime, Pauna continued with her own education. In 2008 she took courses at Biotouch, the oldest school for semi-permanent make-up, and one year later launched her own make-up studio. “Michell Peck – Madonna’s facial specialist – was a guest at the event, and that moment marked my entrance into the professional league.”

She adds that she became both official trainer and sole importer of Biotouch for Romania, Bulgaria and Republic of Moldova in 2011. “Besides that, we also launched the first school of semi-permanent make-up in Romania this year,” says the entrepreneur.

The idea to set up her business came in 2004 when she returned from Paris as a specialist in so-called “visagism”, known as the art of studying and bringing to light the beauty of each human feature.

“This made me want to do such a thing in Romania, so I started by having a few customers a week. But persevering with it I managed to achieve great performances,” remembers Pauna. She strongly believes that her talent drove her to develop such a business, and that she was able to use it in the right way.

“For me it was a single step from passion to business,” notes the owner of Makeup your mind.

As with any new concept or service that appears on the market, the educational part is very important. “My passion is still to teach Romanian women how to become more beautiful and to train specialists up to be highly skilled in

doing this. I have managed to organize a coaching session for 400 Romanian women this year,” says the salon owner.

Asked about the most difficult moment her firm has faced, the entrepreneur says there were plenty such moments and there still are. On top of that, if she started another business she says she would change the blind trust she had in those she has trained during her activity.

“People change from one day to another and when you need them most you are vulnerable. I think that I would be more pragmatic and careful about

Michell Peck – Madonna’s facial specialist – was a guest at the launch of my own make-up studio, and that moment marked my entrance into the professional league. contractual issues like foreign businesspeople are,” says Pauna. It is clear

that L’Oreal has been a very good business school for the entrepreneur as she learned to implement several principles of business management that she met there in her own enterprise.

According to Pauna, one of the most significant challenges that Make-up your mind has faced was that this type of business has the shortest guarantee term. “The evolution of this world is volatile and technologies change from year to year. Plus, there is an ongoing process of investment in such a company. If you invest in your business as much as you should invest in yourself, you will eventually succeed,” believes the entrepreneur.

She decided to enter on a niche where the competition is pretty tight because few specialists have the real financial muscle to fight with the old state-owned institutions and chains of salons.

“In addition you have to constantly go abroad in order to improve your professional skills, to participate in different specialized trade fairs and to bring new products, technologies and know-how that are already being implemented in large European chains of salons,” says the businesswoman.

Pauna believes that what differentiates her from the crowd is the fact that she chose to specialize on a free and unexploited market niche.

Besides that, she has remained faithful to her strategy and managed to capitalize on everything as much as she could. In addition, starting this year Pauna has begun to franchise her business, training beauticians from Targu Mures, Ramnicu Valcea, Bacau and Ploiesti.

As for future plans, the entrepreneur says that because she has become the sole importer of Biotouch for Romania, Bulgaria and the Republic of Moldova, starting this fall her main focus will be on training and distribution.

“I chose that approach because semipermanent make-up, evolving cosmetics and minimal surgery are the future.

This was proven after two years of working in my own studio. This segment represents about 60 percent of my business,” concludes Pauna.

anda.sebesi@business-review.ro

www.business-review.ro Business Review | June 13 - 19, 2011

CITY 19

RESTAURANT REVIEW

RESTAURANT SELECTION Business Review gives you a selection of top Bucharest restaurants. You can check the full-length versions of all the reviews by our resident restaurant critic, Michael Barclay, at www.business-review.ro.

Arcade Cuisine: International Address: Ion Cantacuzino 8 Reservations: 0753 999 333 www.restaurantarcade.ro Over the last nine years, Arcade has become a gastronomic institution in this town. It is best known for its fabulous location and vast summer terrace. This is a top quality, sophisticated chophouse.

Photo: Laurentiu Obae

State of the Union address: reasonable prices, a plethora of pasta and a great grill section are writ large at this authorial residence

La Union

few dishes that were not purely Romanian, and thus they would be acceptable to more sophisticated European palates.

So, to list the menu, there was a selection of well priced starters at an average of RON 10. These included six huge mush21 Strada Ion Caragiale rooms stuffed with melted Gorgonzola, (off Calea Rosetti) which were an absolute delight. Blondie and I passed on: fried mushrooms and garlic, rice chicken and broccoli, rice and ∫ MICHAEL BARCLAY cheese, potato and rosemary grill and a baked pepper salad.

We also passed on their ‘plateaux’ dishSometimes I feel sorry for poor old Romaes of: seven Romanian cheeses at RON 39, nia, for it is so desperate to convey some their fish (carp, salmon tartar, anchovies, kind of cultural heritage to the world, that it promotes mediocrities to iconic status. fish paste and olive paste) at RON 51, and their mixed plateau of sheep cheese, goat Nothing could be clearer than the case of Ion cheese, sausage, pork neck, pastrami and Caragiale (Ion who?), a writer who died 100 smoked bacon at RON 48. Being a Royears ago. Although he is lauded by Romanian, Blondie thought these dishes manian ‘arties’, outside Romania he is an were exciting, and since they were priced unknown nonentity who wrote nothing of for two persons, she asked me to order and any significance in order to enshrine his share with her. I did not do so as they did name on the international literary stage! not appeal to me.

So doubtless we are expected to apBut what did appeal to me was their proach his former home in Strada Caragiale pasta section boasting pastas made in(yes, they even named a street after him) house. At a price of RON 28 for each of the with some reverence in deference to the following, they were a bargain. There was ‘great’ man. Well not me! It is now restaua choice of pastas made with octopus, rant La Union, and I approach it with an moules or prosciutto. For the same price we open mind so as to taste the food. But I chose seafood. It was superb. Our bowl was know this building well, for 12 years ago a laced with moules, four large peeled delightfully eccentric Greek gentleman prawns, sliced calamari and baby octopus. converted it into a restaurant which he In a garlic and wine sauce, it was a bargain. named Casa Caragiale. He was too early for So too was our next dish, ludicrously Bucharest and his quality was so high that named ‘Tagliatelli AOP’. Yes, that’s right he went bust. Truly a Romanian paradox! folks ‘AOP’. Blondie asked our waiter what So when entering it, I noticed that the that acronym stood for, and he replied, new proprietors had done nothing to change the building after the Greek left it “Aioli”. This threw her into confusion, but I smiled benignly as I know that aioli (a three years ago. Certainly there was a minmayo made from egg yolks, crushed garlic, imum of cosmetic changes such as a new lemon juice and olive oil) can be fabulous. lick of paint and a few pictures, but basically Well our tagliatelli pasta arrived with cherit was the same. But the House’s menu was ry tomatoes, with a wonderful aroma of so very different. For it has been reinventgarlic. But no aioli whatsoever! The House ed as a Romanian restaurant, with quite a

made a mistake, but the pasta dish was lovely and so I forgave them.

A sullen Blondie then ordered a ‘chicken with a five herb sauce’. This is the point where Romanian food conflicts with superior Western culinary logic, for when I saw the herbs (basil, rosemary, dill, parsley and thyme) I told her that none of them complement each other in a blend, and that the dill would overpower the dish. Naturally, I was correct and she had a perfectly moist and tender chicken – in a dill sauce!

There was so much we could not sample, such as their grill section which listed: giant ribs at RON 23, pork cutlet at RON 18, sausages at RON 18 and chicken legs at RON 15. And if you think you will get tiny portions to match the price, you would be wrong. The menu states the weight (a crude, old communist practice) and each dish is generously ‘heavy’. The menu also lists the calorie count of each dish, which has to be a total bluff. But an amusing one.

But I just had to try their ‘spicy chicken in brown sauce’ because when I asked our waiter to explain ‘brown sauce’ he pleasantly surprised me by informing me that it was a sauce made by reducing beef bones. Oh yes! I had it and it was good.

So although I disagreed with the composition of so many of their dishes, which included sour cream, mamaliguta, local sausage, and local everything, we chose wisely and each dish we had was recommendable. If I compare this to other ‘specific romanesc’ restaurants I have had the misfortune to stumble into, La Union has to be the best. Oh, a word of warning: they only have a menu written in Romanian which I think is patronizing for foreigners.

And that is the only negative statement I can make about the place. Go for it!

mab.media@dnt.ro

Bistro Epoque Cuisine: French Address: 17C Intrarea Aurora Street Reservations: 021 312 32 32 www.epoque.ro The Bistro Epoque is a smart-casual restaurant offering guests gourmet French cuisine from its master chef Guy Martin. Owner of the restaurant Le Grand Vefour in Paris and holder of two Michelin stars, Martin creates the menus which include a variety of vegetarian dishes.

Divan Cuisine: Turkish Address: Franceza 46 Reservations: 021 312 3034 www.thedivan.ro Expect the usual suspects of hummus, eggplant puree, spiced tomato and so on.

They have a larger selection of kebabs on offer than their competitors and this includes beef, lamb, beef and lamb combo, chicken and marinated meat stuffed in an eggplant.

Heritage Cuisine: Fusion Address: Polona 19 Reservations: 021 210 8850 www.heritage-restaurant.eu After five years of making mistakes along with constant changes of management, chefs and directors, it appears that Heritage has finally got it right! They brought the mountain to Mohammed by importing a Michelin-starred chef.

La Veranda Cuisine: Seafood Address: Crowne Plaza, Poligrafiei 1 Reservations: 021 224 0034 www.laveranda.ro Here we have a House that challenges you with a choice of preparations, and for the first time ever, they even offer you a selection of fish sauces. The standards of the House have been significantly raised.

Osho Cuisine: American: steak and grill Address: Primaverii 19 Reservations: 021 568 3031 www.osho-restaurant.ro They modestly call themselves a steakhouse, but it is much, much more than that. You will find yourself in a shop which sells all of the chophouse’s products, ‘over the counter’ at retail prices.

www.business-review.ro Business Review | June 13 - 19, 2011

20 CITY EXHIBITION

Comic books take over museum

In the frame: comic fans can get graphic at the Contemporary Art Museum

The fourth floor of the National Museum of Contemporary Art in Bucharest will be given over to the history of Romanian comics, through a Comic Book Museum.

The official opening will take place on June 16, starting at 19.00, when three exhibitions will have their official launch: Thesaurus – The History of the Romanian Comic Book, The International Salon of Romanian Comic Books, and How to Make a Comic Book.

“We will try, for a limited period of time, to show the diversity and richness of the ninth art in Romania, to demonstrate the continuity of this art over 120 years, under three very different regimes, each with its own characteristics, to highlight connections between comics and caricature, book illustration, cartoons and literature, to bring to attention young artists from comic books today,” said Alexander Ciubotariu, who has written a book on the history of Romanian comics and organized a previous exhibition on the subject.

The exhibition will last until October 16. June 16, the official opening date, will also see the opening of the Webcomics of Romania exhibition and the release of the fourth issue of Comics magazine. Later in the evening, at 20.30, the National Museum of Contemporary Art’s terrace will host musical performances by Cycler and The Graphic Show.

International events that will take place at the Comic Book Museum will include film projections by the Austrian Cultural Forum and the Czech Center in July and an exhibition by Portuguese artist Eugenio Silva. Autumn will also bring a series of events organized by the British Council. The full program will be available at www.muzeulbd.ro.

The National Museum of Contemporary Art is located at Izvor 2-4 (Palace of Parliament building – E4 Wing, entrance from Calea 13 Septembrie), in Bucharest.

Closest subway station: Izvor. More information at www.mnac.ro. ∫ Corina Dumitrescu

AUCTION

CONCERT

Emil Cioran’s manuscripts to be published online, new auction organized

UB40’s Ali Campbell ready to reggae to Romania for charity concert

Romanian thinker Emil Cioran The Emil Cioran manuscripts purchased by businessman George Brailoiu and donated to the Library of the Romanian Academy have finally reached their destination, “the institution that has to maintain and cultivate the Romanian language and look after the Cioran manuscripts that I purchased”, as Brailoiu put it.

A new auction will now be organized in France for other manuscripts by Cioran, a Romanian-born philosopher and essayist who spent his career in France.

The academy aims to hold a public auction, to bring the manuscripts to Romania. The starting price for the items due to go under the hammer at the new auction in Paris is EUR 1.3 million.

This lot of manuscripts were found by housekeeper Simon Baulez, who was hired in 1998 to clean and empty Cioran’s

apartment, on Odéon Street, Paris. Her contract stipulated that she could take anything she found there. Baulez claimed she found 35 manuscripts by Cioran, including writings and a personal diary.

She took them to an auction house in 2005, but the University of Paris contested her right of ownership. Simone Boué, who had lived with Cioran, had donated all his works to the University of Paris.

However, the French court declared the cleaning lady the rightful owner of the manuscripts, as she had saved them from destruction.

The manuscripts that the maid found include five successive versions of De l’inconvénient d’être né (The Trouble With Being Born), notebooks with preparatory notes for Ecartelement (Drawn and Quartered) and for Aveux et anathèmes (Confessions and Anathemas), as well as 18 unpublished notebooks which contained pieces of his journal which he wrote between 1972 and 1980.

Scholar Florin Filip, general manager of the Romanian Academy’s Library, has promised that in three months, at most, there will be an online version of these manuscripts at www.biblacad.ro.

Fellow academic Eugen Simion has also proposed the publishing of a facsimile edition of the texts, as happened with Eminescu’s manuscripts.

Among the documents purchased by Brailoiu at the April auction were: Cioran’s BA diploma (for EUR 17,000), his bachelor degree thesis (EUR 8,500), the manuscript of Cioran’s famous work The Transfiguration of Romania (EUR 20,000), The Book of Delusions (EUR 13,000) and Tears and Saints (EUR 8,000). ∫ Corina Dumitrescu

involvement in charity work throughout the world and received a special award from the government of Mauritius for his efforts in 2010. He aided the Mandela Foundation in 2008, recording one of his most successful UB40 covers, Many Rivers to Cross, with Ladysmith Black Mambazo, In 2008, Campbell quit UB40 to pursue a solo career. The band formed in Birmingham in 1978, its name an ironic reference to the form required We’ve got you babe: ex-UB40 frontman is coming to Romania to claim unemployment benefits at that time. The reggae outfit has had over The former lead singer of British reggae 50 singles in the UK charts, and enjoyed band UB40, Ali Campbell, will perform in Bucharest, at Sala Palatului, on June 16. considerable international success, selling over 70 million records. The band’s best The artists will donate the money raised known hits include Red Red Wine, from sales of his latest album on the conKingston Town, Can't Help Falling in Love, cert day to disabled, abandoned and disand I Got You Babe. The concert will be advantaged children and young adults.

The album that Campbell is promoting, opened by Romanian band Taxi.

Great British Songs, is a collection of iconic UK pop and rock hits from the sixties and seventies, reinterpreted in the signer’s Tickets cost RON 70, RON 100, RON 140, well-known reggae style.

RON 180 and RON 220 and can be purThe concert is being organized by chased from the Eventim network stores: FARA, a charitable foundation set up in RoGermanos, Orange, Vodafone, Domo, plus mania, whose patrons are HRH Prince the Humanitas and Carturesti bookshops Charles, Nicole Kidman and HRH Princess and online at www.eventim.ro. ∫ Marina Sturdza. Campbell is known for his Corina Dumitrescu

www.business-review.ro Business Review | June 13 - 19, 2011

CITY 21

FILM REVIEW

Kung Fu Panda 2 Directed by: Jennifer Yuh Nelson Starring: Jack Black, Angelina Jolie, Dustin Hoffman, Gary Oldman, Jackie Chan, Lucy Liu, Seth Rogen, JeanClaude Van Damme On at: Cinema City Cotroceni, Cinema City Cotroceni - Sala VIP, Cinema City Sun Plaza, CinemaPro, Hollywood Multiplex, Movieplex Cinema, Patria, Samsung Imax Cotroceni, The Light Cinema

∫ DEBBIE STOWE Hiiii-yah! Take everybody’s favorite cuddly, endangered animal. Hoo-wah! Assemble an A-list cast of voices including Jack Black, Angelina Jolie and Dustin Hoffman. Deploy said A-list cast to the Cannes festival, replete with their photogenic Hollywood star boyfriends and families, where the case. Wait for world’s media to descend. Woo-cha! Add a quirky martial arts twist. Ah-ho! And get hit cartoon factory Dreamworks to package it all together.

You can then pretty much sit back and wait for the hundreds of millions of panda pennies to roll in, as with that mix, it would be difficult for the Kung Fu Panda franchise to go wrong. And with its predecessor taking over half a billion dollars, KFP2 (yep, it’s got its own acronym) was pretty much dead-cert celluloid gold.

Happily, it’s also a lovely film. The Chinese setting has allowed the cinematographers and designers to draw on a myriad of Asian clichés – mist wafting over valleys, seas of gently sloping red tiled roofs, lantern-bedecked courtyards, beads of dew dropping off elegant trees, you know the thing – to render a stereotyped China of extraordinary beauty, mystery and elegance.

Throw in 3D and the visuals are so striking that they seem almost out of place in what is ostensibly a children’s computer-animated action comedy. Into this context come fight scenes so precisely choreographed that they make The Matrix look a bit thrown together and sloppy.

All of which makes the contrast with our hero, the eponymous martial artist

mammal, the more incongruous. He might be doing his stuff to the serene backdrop of undulating hills and tiered towers, but Po (Jack Black) is a typical US teenage boy, a bit of a slacker, charmingly cheeky, awkward with girls, trying to navigate the tricky transition to adulthood and using phrases like “severely cool”. He’s a likeable character, with some great lines – “Ah, my old enemy… stairs” could have come straight from the mouth of Homer Simpson. Indeed, the smart one-liners are one of the film’s most memorable aspects, which is even more impressive considering how amazing it looks.

The plot, well, you can probably guess the plot. Peace-loving existence of Po and good guys threatened by theatrically evil bad guy, who seeks world domination and to kill pesky Po and chums in the process. Our antagonist is the peacock Lord Shen (Gary Oldman), who embarked upon a brutal panda massacre after learning from a fortune teller that his goal of said world domination would be thwarted by a black and white nemesis. (A lucky escape for the zebras and the penguins then! Although there are probably not too many of them living in China.)

In the meantime our plucky panda must come of age and learn an important moral lesson, which in this case, children, is inner peace. Which can apparently be achieved by whacking a lot of bad guys.

But that’s just being picky.

There’s also an unashamedly sentimental subplot about Po’s birth parents (he was a foundling raised by a goose – one of the film’s sweetest characters), which paves the way for another sequel.

Naturally, the narrative holds few surprises, but it is all done with aplomb, and tugs on the heartstrings so effectively that adult viewers will be surreptitiously wiping away the odd tear, Toy Story 3 style.

Whatever your misgivings over film franchises and the Hollywood juggernaut, Kung Fu Panda 2’s charming characters and slickly beguiling aesthetics will terminate them with the merciless karate chop of a cute endangered mammal.

editorial@business-review.ro

Everybody was kung-fu fighting: KFP2 is kicking its way to box office domination

www.business-review.ro Business Review | June 13 - 19, 2011

22 IN TOUCH CULTURAL CALENDAR Concerts June 16 Sala Palatului UB40’s Ali Campbell comes to Romania for charity concert The former lead singer of British reggae band UB40, Ali Campbell, will perform. Money raised from sales of his latest album on the concert day will go to disadvantaged young people.

Romanian Athenaeum June 14 19.00 Trio Pro Arte On the bill: Ludwig van Beethoven Performers: Anda Petrovici (violin), Marin Cazacu (cello), Nicolae Licaret (piano) June 18 19.00 Organ recital On the bill: Johann Sebastian Bach, Wolfgang Amadeus Mozart, Wieland Meinhold, Franz Liszt June 23-26 George Enescu National Museum 10.00-15.00 piano master class Piano maestro Dan Grigore will give piano classes with audience participation. Candidate selection will be through demo audio recordings. Attendance only is RON 40 (20 for students).

Art June 16 – October 16 Contemporary Art Museum, 4th floor Romanian Comic Book Museum The official opening will take place at 19.00 on June 16, when three exhibi-

WHO’S NEWS Mihai Ghyka

BUSINESS AGENDA tions will be launched: Thesaurus – The History of the Romanian comic book, The International Salon of Romanian Comic Books and How to Make a Comic Book.

Photo exhibitions May 28 – June 24 Crowne Plaza, Foyer Magnolia An A to Z of Romania - Through the Lenses of Expat Women Second edition of the fundraising event.

Organized by a group of amateur female photographers, the exhibition gives a new perspective on Romania.

Cinema June 10 X-Men: First Class Directed by: Matthew Vaughn Starring: Michael Fassbender, Jennifer Lawrence, January Jones, James McAvoy Plot: In 1962, Charles Xavier starts up a school and later a team, for humans with superhuman abilities.

On at: Movieplex Cinema Plaza, The Light, Hollywood Multiplex, CinemaPRO, Cinema City Cotroceni, Cinema City Sun Plaza, Baneasa Drive-In June 17 (premiere) Hanna Directed by: Joe Wright Starring: Cate Blanchett, Eric Bana, Saoirse Ronan Plot: A 16-year-old raised by her father to be the perfect assassin is sent on a mission across Europe, tracked by a ruthless intelligence agent.

June 14 ∫EVENT Business Review organizes the third Dutch Business Forum at Capital Plaza Hotel. For more info please visit www.business-review.ro/events.

10:00 Schneider Electric Romania opens its Regional Center for Customer Relations in Bucharest. By invitation only.

11:30 Artmark organizes a press conference for its Summer 2011 Auction at JW Marriott Bucharest Grand Hotel.

By invitation only.

June 15 PwC organizes a press conference for the launch of a report on thermal energy at its headquarters. By invitation only.

June 16 11:00 The Romanian Association of Cement Producers (CIROM) organizes an event for its 20th anniversary at the Diplomatic Club. By invitation only.

June 16 Vodafone and HTC launch the HTC Sensation phone at Fratelli. By invitation only.

June 21 ∫EVENT Business Review organizes the third Energy - Focus on Oil & Gas event at Ramada Plaza Bucharest. For more info please visit www.business-review.ro/events.

WHAT WE ARE WORKING ON Otilia Haraga Journalist is working on a piece about an IT player that has plans to expand its footprint on external markets and has disclosed its future strategy to BR. Read the article to see how it copes with cash bottlenecks from public projects and how many offices it plans to open abroad. otilia.haraga@business-review.ro

QUOTE of the week US ambassador to Bucharest Mark Gitenstein “In the US, seizure of property is very simple and takes place regardless of the name under which the property is listed. If it cannot be legally justified then it is confiscated. The problem in Romania is the assumption that the acquired fortune is legal.”

Business Review welcomes information for Who’s News from readers.

Submissions may be edited for length and clarity. Get in touch at simona.bazavan@business-review.ro

has been appointed chief commercial officer, consumer business unit, at Vodafone, starting June 20. Previously, he was president and general manager of Bergenbier Romania (formerly InBev) and he worked for more than a decade in finance and marketing roles for the company, both in Romania and in the wider Balkans region. He was the Eisenhower Fellow Romania 2009, in the USA. Ghyka will be replacing Karsten Wildberger, who will be leav-

has been appointed CEO of Billa Romania as of July 1. She is replacing Emil Stefanov who has managed the retailer’s network in Romania and Bulgaria for the past two years.

Georgia has over 14 years of professional experience in the field of retail. She has held various top management positions working for retailers like Real, Metro Cash

is the new country manager of PointPark Properties (P3). He previously held the position of commercial director at Willbrook International, where he was responsible for the creation of the company’s asset management department as well as for run-

ning the sales and marketing departments for Romania, Georgia and Bulgaria. Gheorghiu graduated from the Faculty of Chemical Engineering at Monash University in Melbourne, Australia. He has 15 years of local as well as international real estate experience and has expertise in development and asset management. He spent six years at the commercial real estate firm Colliers International as a senior consultant in Bucharest and Mexico City, and later held the position of corporate services director in Bucharest. He gained further experience in development as managing director of Europolis Real Estate Fund in Romania.

ISSN No. 1453 - 729X

FOUNDING EDITOR Bill Avery EDITOR-IN-CHIEF Simona Fodor SENIOR JOURNALIST Otilia Haraga JOURNALISTS Simona Bazavan, Corina Dumitrescu COPY EDITOR Debbie Stowe COLLABORATORS Anda Sebesi, Michael Barclay ART DIRECTOR Alexandru Oriean PHOTOGRAPHER Laurentiu Obae LAYOUT Beatrice Gheorghiu

PUBLISHER Anca Ionita EXECUTIVE DIRECTOR George Moise SALES & EVENTS DIRECTOR Oana Molodoi MARKETING MANAGER Adina Milea SALES & EVENTS Ana-Maria Nedelcu, Claudia Munteanu RESEARCH & SUBSCRIPTION Lili Voineag PRODUCTION Dan Mitroi DISTRIBUTION Eugen Musat

ADDRESS No. 10 Italiana St., 2nd floor, ap. 3 Bucharest, Romania LANDLINE Editorial: 031.040.09.32 Office: 031.040.09.31 Fax: 031.040.09.34 EMAILS Editorial: editorial@business-review.ro Sales: sales@business-review.ro Events: events@business-review.ro

ing the company as of August 1, and continuing his career in a new role for the Vodafone Group.

Sorana Georgia

& Carry and Spar and gaining expertise in operations management, HR, marketing and project management. Georgia holds a degree in engineering from the Transylvania University in Brasov.

Stefan Gheorghiu