Page 1




Petrom has reached an agreement to lease its data center in Petrom City on a ten-year contract to IBM, which will provide data center services to OMV, Petrom and other clients in Romania See page 4

BR surveys the activity of local wine producers to see how they are doing in the current difficult economic situation and finds that many are focusing on exports See pages 12-13

Romanian sensation Inna is part of a new generation that has found commercial success outside the local music scene. BR looks at what has made the singer a hit with international audiences See pages 14-15



OCTOBER 11 - 17, 2010 / VOLUME 14, NUMBER 37


Dinu Patriciu is now focusing on expanding the chain of proximity stores and has EUR 200 million available for investments. The businessman says he plans to take on foreign retailers, which currently dominate the market, and attract local entrepreneurs to the project see pages 10-11




October 14 é Business Review organizes the

What we are working on OTILIA HARAGA, Senior Journalist...

TAX & LAW- New fiscal measures: effects and consequences event at Howard Johnson Hotel

is writing an article about the degree of


absorption of Euro-

October 26

pean fund close to

é Business Review organizes the

Fiscal Litigations event at Ramada Plaza.

October 28

the end of the year.

DANA VERDES Senior Journalist... is working on an analysis about tax aspects of doing business in Romania vs Bulgaria and Republica Moldova.

é Business Review organizes the

Energy - Focus on Power event at Howard Johnson Hotel.

November 4 é Business Review organizes the

Russian Business Forum at Ramada Plaza Bucharest.

SIMONA BAZAVAN Journalist...

November 11

is investigating why some local companies decided to move operations to Bulgaria or the Republic of Moldova.

é Business Review organizes the


Turkish Business Forum at InterContinental Bucharest.

November 18 é Business Review organizes the

Risk Management event. AGERPRES

The recent series of street protests continued last week with some 8,500 education workers massing in Bucharest in front of Palatul Victoria over wage cuts and the government’s austerity measures. Unions are calling for higher salaries, an end to layoffs and investment in education

For more information visit


Experts gather at Tax & Law conference to discuss consequences of new fiscal measures


The next Tax & Law conference will take place on October 14

Business Review continues its series of legal conferences with the Tax & Law business breakfast taking place on October 14, at Howard Johnson Hotel. The event will provide an update of the major legal and financial issues facing the Romanian business market, as well as a presentation of the

BUSINESS REVIEW / October 11 - 17, 2010

new fiscal system and how it affects companies doing business here. This event is part of a series of breakfasts for members of the business community who are interested in getting expert opinion and advice on important business decisions, such as: restructuring, risk management, taxation, dispute resolution and investing during a downturn. The event will gather legal and tax experts, toplevel executives and entrepreneurs, business consultants, CFOs and government representatives. So far, the confirmed speakers are Marius Stancescu, founder and president of Riff Holding International; Emilian Duca, partner at BDO Tax; Gabriel Sincu, partner, head of tax & outsourcing, Mazars; Florin Gherghel, head of tax department, Noerr Finance & Tax; Gabriel Biris, managing partner at Biris Goran; Dan Schwartz, managing partner, Scot&Company Romania; Arpad Ladanyi, general commissioner, Financial Guard; Anamaria Acristini, tax director, E.ON Servicii; and Angela Rosca, managing partner, TaxHouse.

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Founding Editor BILL AVERY Editor-in-Chief SIMONA FODOR Senior Journalists ANCA IONESCU OTILIA HARAGA

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Lufkin Industries expects new Ploiesti Petrom and IBM sign multi-million plant to begin production by end-2012 EUR contract for data center services

Lufkin Industries has announced that construction has been started at its 33-hectare facility in Ploiesti, after an investment of USD 126 million, of which EUR 28 million consisted of state aid from the Romanian government. This new facility will provide oil field manufacturing hubs to serve the Eastern hemisphere as well as Western Europe, Central Asia, the Black Sea region, the Middle and even the Far East, to which 80 percent of production will be directed, with 20 percent focusing on the Romanian market. The reason behind the choice of Ro-




Jay Glick (left) discusses Lufkin’s plans for Romania

mania as a hub for the Asian and Middle Eastern markets is the country’s 143year history in oil production, availability of highly-skilled professionals, geographical position, excellent supply base for the raw materials that Lufkin products need, as well as Romania’s benefits from EU membership, Jay Glick, CEO and president of Lufkin Romania, explained. Lufkin Industries expects to reach a USD 30 million turnover in its first year of production and then to gradually double it, reaching an estimated USD 70 million in the following two years. Future investment is also expected by the company in Romania, especially due to the large surface area of the plant in Aricesti. The company official said Lufkin had opted for a greenfield investment simply because building a company from the ground up was easier than reconditioning an older one. Lufkin Industries’ plant in Romania will become functional in the fourth quarter of 2010, providing jobs for over 320 employees Corina Dumitrescu

Mihai Tudor, country general manager, IBM Romania

Petrom and IBM have signed a contract worth several million EUR through which IBM has rented the data center at Petrom City and will provide data center services to Petrom and OMV as well as other unrelated clients IBM plans to attract. The contract will run for ten years. “This agreement shows the importance IBM places on the enhancement of its operations in developing countries and we expect that by 2015, 25 percent of our revenue will come from emerging

markets, including Romania,” said Mihai Tudor, country general manager, IBM Romania. Thus, IBM will offer its clients data center-specific services such as hosting and installation, cloud computing as well as others such as data back-up and recovery in the event of calamities. “This agreement will help Petrom reduce operational costs with the data center, allowing IBM to offer its clients an entire range of IT services in a manner that is time- and cost-efficient,” said Tudor. The data center is located in the Petrom City campus and is entirely supplied with electricity from a power plant on the site. Petrom City, the future headquarters of Petrom, is located in northern Bucharest. Approximately 2,500 employees will work there, who are currently in centers in Bucharest and Ploiesti. The campus comprises two office buildings, a data center, a 5MW power plant and a parking lot with 900 places on a surface of 100,000 sqm. Otilia Haraga

BUSINESS REVIEW / October 11 - 17, 2010


FIC proposes measures to reboot economy


Mariana Gheorghe, CEO of Petrom and president of FIC

The Foreign Investors’ Council (FIC) launched last week a series of 80 economic measures that form the Program for Economic Growth – Priority Measures to Restart the Economy. The proposals come in addition to the government’s austerity plan and, if implemented, will not conflict with the budgetary target agreed upon with the IMF, said FIC representatives. “We are convinced that on the short term the Romanian economy can return to growth, with minimal costs, if we follow a clear strategy, endorsed both by the government and the business environment. To make sure that this happens, we are willing to offer our expertise, work together with the authorities and allocate consistent financial resources in order to support the priority actions,” said Mariana Gheorghe, president of the FIC and CEO of Petrom. The measures target 10 distinct

fields which cover the economy’s most important objectives: macroeconomic stabilization, implementing more efficient governance, supporting SMEs and investments, absorbing EU funds, improving infrastructure, agriculture and the tax system, legal reform and modernizing the public sector. According to the FIC’s econometric projections, implementing the program’s 12 priority measures alone should generate additional total economic growth of 11.6 percent, 250,000 new jobs and an 8.5 percent increase in budgetary incomes by 2015, all with additional budgetary costs of 0.8 percent of the GDP. The measures include: creating a Claims Registry to offer public information about firms’ state receivables, implementing and starting the First Home 3 program, privatizing state-owned companies through the capital market, setting a clear calendar for developing infrastructure, offering financial facilities for SMEs and making labor laws more flexible. Gheorghe said that FIC representatives had already begun talks with the authorities which would continue over the coming weeks. The first results will be announced in November. The FIC has over 110 member companies which have so far invested over EUR 30 billion in Romania. This roughly amounts to two thirds of the total investments to Romania, according to FIC data. Simona Bazavan

EBRD grants EUR 335 million financing to Alpha Bank, Piraeus Bank and Bancpost The European Bank for Reconstruction and Development EBRD has granted combined financing of EUR 335 million to three local banks: Piraeus Bank, Alpha Bank and Bancpost. The financing was granted in conjunction with similar efforts for sister banks across the region, and in support of the real economies in these countries. The subsidiaries of Piraeus Bank in Romania, Bulgaria and Albania received a total of EUR 200 million credit lines for on-lending to business in their respective countries. Under the project Piraeus Bank Romania will receive EUR 90 million, Piraeus Bank Bulgaria EUR 70 million, and Tirana Bank EUR 40 million of new funding from the EBRD. The EBRD has also signed two credit lines worth a total of EUR 200 million for subsidiaries of Alpha Bank Group, Alpha Bank Romania and Alpha Bank Serbia, helping to increase the availability of financing for private businesses in the two countries. Alpha Bank Romania will receive EUR 150 million and Alpha Bank Serbia EUR 50 million of new funding from the EBRD.The EBRD will also fi-

nance with EUR 230 million Bancpost in Romania, Eurobank EFG Bulgaria, and Eurobank EFG in Serbia. Bancpost will receive EUR 95 million, Eurobank EFG Bulgaria AD (Postbank) EUR 75 million, while Eurobank EFG Beograd will get EUR 60 million. The EBRD financing will provide the banks with medium-term senior funding to help their funding base diversify, extend the maturity of their liabilities and enhance their lending to the economy as well as strengthen further their presence in these markets. These packages of loans, to be provided in two equal tranches, are part of the Joint International Financial Institutions Action Plan and follow other similar facilities offered to the subsidiaries of the major Western European strategic banking groups engaged in the region over the past 18 months. Under the Joint IFI Action Plan, unveiled in February 2009, the EBRD, the World Bank Group and the European Investment Bank (EIB) pledged to provide EUR 24.5 billion over two years to support the economies of Eastern Europe via the banking sectors. ■

Patriciu: ‘I would have paid the RRC’s EUR 571 million debt’

BUSINESS REVIEW / October 11 - 17, 2010


Romanian businessman Dinu Patriciu told a press conference last week that he would have paid Rompetrol Rafinare’s (RRC) EUR 571 million debt to the state budget. Asked from where he would have got the money he answered that he had left the company with operational profit.Patriciu added that the majority shareholder KazMunaiGaz (KMG) choosing not to pay the entire debt is a right conferred by the contract. According to Patriciu, the RRC’s debt was taken into account when he sold the majority stake in the Rompetrol Group to KMG. In October 2003 CHECK when Patriciu was Rompetrol’s owner, the Nastase government transformed its budgetary debt into state bonds with a seven-year maturity. On September 30 the deadline expired and KMG, the new

Dinu Patriciu

majority shareholder, decided at its general shareholders assembly to convert the bonds into shares. The state thereby once again became a minority shareholder at Rompetrol with a 44.69 percent stake. The government has announced that it will contest the RRC general shareholders’ assembly decision in court. Dana Verdes. 5


ANRE must be independent with external financing sources – SAR report


ANRE needs independent financing sourcing

The Romanian Energy Regulatory Agency (ANRE) must not be subject to political pressures, says the Romanian Academic Society (SAR) in its recently published report. The document calls for immediate action both from the govern-

ment’s side and also from the ANRE. The SAR report urges the government to repeal several ordinances, to commit not to change presidents mid-term except where the annual reports are rejected, to amend energy laws to make appointments of the ANRE management and to refrain from exerting informal pressure on the regulator, while saying the cabinet must use its statutory powers to enforce good governance practices at the ANRE. The report also makes some suggestions for the ANRE. SAR officials say that it needs to introduce and enforce a code of ethics to supplement legislation, ensure external financial and process audits, and report on actual regulatory performance and quality. Dana Verdes

Toxic sludge from Hungary reaches the Danube



Toxic mud from Hungary reached the Danube last week, threatening the ecosystem of Europe’s second largest river. The Romanian Ministry of the Environment issued an official statement saying that the decontamination measures taken by Hungary had lowered the PH levels of the Marcal river, a tributary to the Danube, protecting the latter’s flora and fauna from harm. On the Romanian side of the Danube, pollution levels are constantly measured and the results currently show no danger, as the river’s flow seems to be high enough to ensure the water’s dilution capacity. The Hungarian government declared a state of emergency last Tuesday morning in three counties in western Hungary due to floods generated by chemical waste leaking from a damaged tank, belonging to Mal, a local alumina plant, reported news wire Mediafax. However, the Romanian Ministry of the Environment and Forests said that there was no danger of the floods reaching the Danube in Romanian territory in the following 24 hours. Officials from the Hungarian aluminum producer that owns the damaged tank, Mal Zrt, said that repair works had been started at the accident location to prevent any other leaks. According to Mediafax, officials also made it clear that 96-98 percent of the chemical substances were still in the tank. An estimated 700,000 cubic meters of chemical

The Danube has been affected by the mud spill

residue leaked from the broken reservoir on Monday. Mal Zrt representatives said that the leaked chemical residues were not toxic or soluble in water, in line with EU norms. However, over 100 people were injured in the flood and four died, Mediafax reported. The current danger is that the pollution may eventually reach the Moson and spread to all the countries through which the Danube flows. A state of emergency was declared in Veszprem, Gyor-Moson-Sopron and Vas counties, where hundreds of people have been evacuated since the disaster. According to Reuters, the Hungarian government has suspended production at Mal Zrt, ordering the firm to repair the damaged reservoir. Corina Dumitrescu BUSINESS REVIEW / October 11 - 17, 2010


WHO’S ALEXANDRU GOSA has joined Badea Clifford Chance. His practice encompasses a wide range of mergers & acquisitions transactions, as well as public procurement projects and complex litigation cases. Before joining the firm, Gosa worked for a Romanian law office affiliated to one of the Big Four firms. He graduated from the Bucharest University Faculty of Law in 2002 and has been a member of the Bucharest Bar since 2003. LEIF CHRISTIAN CROPP is leaving E.ON Romania at the end of this month, to go back to the group’s headquarters in Germany. He has worked for the energy company for 25 months, being in charge of the acquisition of natural gas and power as director of the gas supply division. Cropp studied law in Heidelberg, Buenos Aires and Kiel. He holds a MBA degree from Handelshochschule Leipzig (HHL) in international management. CRISTIAN SAS has been appointed COO of Anima Specialty Medical Services by the A&D Pharma Group. He has professional experience of over ten years in business development in the fields of medical services and private health insurance. Sas previously worked as project manager at Allianz-Tiriac Asigurari after nine years serving in the management teams of Polisano Clinic and Centrul Medical Unirea. SORIN SUSNEA, 32, has joined Lina & Guia as associate partner after having previously collaborated with the law firm as an independent consultant. He holds extensive preofessional experience in litigation and commercial law. Susnea is the founder of the Susnea & Popescu boutique law firm. MARIA ELISEI has been promoted to director of healthcare & pharmaceuticals at KPMG. She specializes in healthcare and pharmaceuticals, and has also tak-

NEWS en part in many engagements in a wide variety of industries. Her experience with capital markets transactions includes taking a Romanian business on the London Stock Exchange. TUDOR GRECU has been promoted to director of financial services at KPMG. He is a specialist in financial services and the insurance sector. His experience derives from being part of the company’s banking audit group as it has grown and developed over the last decade to its current position in the financial services consultancy market. He specialises in regulatory matters in his sector such as Basel II and capital requirements for banks. ANGELA MANOLACHE has been promoted to director of accounting advice and IFRS Solutions at KPMG. She joined the company nine years ago and during this period she has built her expertise in a broad range of areas of accounting: Romanian and international, both industry specific (financial services, telecom, oil industry) and general purpose (consolidations, conversions). She is a specialist in financial instruments, including derivatives and hedging, and she also coordinates financial risk management engagements. SIMONA STAVROSITU has been promoted to director for the telecoms sector at KPMG. She has been working for the company for 11 years and has wide experience in managing audits of large Romanian firms and international groups operating in Romania, reporting under IFRS, US GAAP and SOX 404. Stavrositu has coordinated audit engagements for the oil industry, electronics manufacturing, IT software, food and beverages, as well as the telecoms sector.

Business Review welcomes information for Who’s News from readers. Submissions may be edited for length and clarity. Feel free to contact us at BUSINESS REVIEW / October 11 - 17, 2010

EVENTS, BUSINESS AND POLITICAL AGENDA OCTOBER 14 é 9:00 - The British Romanian Chamber of Commerce (BRCC) organizes

the Market Leaders Question Time Debate event with the occasion of its 2010 AGM at the Radisson Blu Hotel. By invitation only. é The 2010 edition of the National Conference on HR takes place at Rin Grand Hotel. By invitation only.

OCTOBER 15 é TEDxBucharest2010 takes place in Bucharest. Attendance is by admis-

sion process only.

OCTOBER 20 é TotalSoft organizes a press conference to announce its financial results

for the first three quarters of 2010 at the Radisson Blu Hotel. By invitation only.

OCTOBER 21 é Centrul Medical Unirea organizes a new edition of the European Bahá’í

Business Forum (EBBF) conferences at CMU Baneasa. By invitation only.

OCTOBER 27 é 19:00 – The Dinu Patriciu Foundation organizes the Education Award

Gala at the Parliament Palace. By invitation only.

Romania to post sharpest decline in emerging Europe, predicts IMF Romania will register the sharpest economic decline this year of all countries in emerging Europe, according to the World Economic Outlook from the International Monetary Fund (IMF).The country will post a fall of 1.9 percent this year, while next year it will have the smallest GDP growth among these countries, at only 1.5 percent. Romania’s inflation rate is also among the highest in these European states but its unemployment

rate is one of the lowest. Among the countries in emerging Europe, the IMF anticipates economic growth of 3.7 percent this year, followed in 2011 by growth of 3.1 percent. Turkey and Poland will be the engines of growth, with their economies increasing by 7.8 percent and 3.4 percent respectively this year. Next year, Turkey will see growth of 3.6 percent and Poland of 3.7 percent. Otilia Haraga

President returns pensions bill to Parliament President Traian Basescu has announced that he has decided to send the draft of the Pensions’ Law back to Parliament, with a different retirement age for men and women. Basescu is proposing that women should retire at 63, instead of 65 as the bill stipulates in its current form. “I support unconditionally equality by law of opportunities and

treatment between women and men, but I must consider the social realities in Romania. I cannot help noticing that women have a more difficult situation than men. A woman who has a job in the public or private sector also has to work at home, so women work twice as much in Romania,” said Basescu. Otilia Haraga

The figures cited in the news item headlined “A ustrian A irlines reports EUR 207 million local revenue for the first 8 months” in last week’s edition refer to the BSP production (Bank Settlement Plan/IATA ) and not to A ustrian A irlines in Romania.



French investors committed to doing business comme il faut One of the many changes brought about by the economic crisis is to mentality. Easy money has become a thing of the past, said company officials present at the second edition of the French Business Forum organized by Business Review. Simona Bazavan 1









■ 1. David Nicholl, country president at Schneider Electric ■ 2. Philippe Mer, chairman of the board of directors at BNP Paribas Real Estate Romania ■ 3. Cristophe Weller, managing partner at Corporate Office Solutions ■ 4. Claudiu Munteanu-Jipescu, partner with Salans Romania ■ 5. Luc Diebold, sales manager at AIR FRANCE KLM Romania ■ 6. Karim Kheirat, country manager of ICAP Romania ■ 7.Panelists discussed some of the strategies that their companies implemented in order to overcome the crisis ■ 8.The event gathered about 70 company officials 8

The economic crisis was a wake-up call for many local companies and a harsh one too as the market collapse came hard on the heels of the unprecedented economic growth registered in previous years. One didn’t even need to be an efficient manager to post profit back then, some of the company representatives present at the event agreed. Coming back to 2009 and 2010, efficiency and cost control have become the name of the game. Companies who have managed to pass the test and return to growth say they have done so by adjusting to the new market conditions through rationalizing costs and getting closer to their clients. All is not bleak – there is still potential for business in Romania and some of the authorities’ latest measures are expected to encourage the business environment. Topics discussed by company representatives included the new Labor Code, which businesspeople have long been saying should generate more flexibility on the local labor market and stimulate employment. The new public procurement law should also bring a boost to joint ventures between the authorities and private companies with a positive effect on the development of local infrastructure. So far, French investments in Romania are estimated to have reached approximately EUR 7 billion. Almost EUR 600 million was spent last year alone, making France the fifth largest investor in the country. The event, which attracted about 70 company officials, was organized in partnership with Schneider Electric, Salans and Marsh. For more information about future BR events, please visit BUSINESS REVIEW / October 11 - 17, 2010

Passionate Professionals

BUSINESS REVIEW / October 11 - 17, 2010

bases, the firm also provides legal advice and assistance in English and French. c) In what sectors are most of the firm's clients concentrated? ( How many are local companies and how many are international?) Although we have initially tried to maintain a 50/50 balance, almost 3 quarters of our clients are now international companies activating as important players in the Automotive industry, Real Estate, Constructions and I.T. area. d) What type of practice areas are you looking to expand to/ add in the future (if any)? To a certain point, every area has its potential for developing. Considering that we are now living in a very fast changing world, we are trying to be very adaptive towards the market’s needs. Therefore, our resources and infrastructure allow us to quickly cover the changes in the business environment in a properly manner. We are confident in the future expansion of I.T. industry, Mergers and Acquisitions and Trade Services in general, our team being prepared to take on any new challenge within these areas.

e) How do you see your law firm developing on the short and medium term? Because we have managed to develop a young team of professionals supported by a well designed structure, efficient management and innovative leadership, we see ourselves, on the short term, as a successfully defined organisation. On the medium term, we are confident that we shall increase our business with over 30%. f) What type of legal services are now in high demand because of the financial downturn? Are you adjusting your services portfolio in any way to respond to that? Just like everyone else, our clients have been trying to overcome this financial downturn as they knew best, but inevitably still lead to a decrease in the general activity of our clients, and by consequence of some of our activity. From the legal point of

view, the downturn also generated an increase in Arbitration and Disputes, Trade Registry Activities and a lot of labour law conflicts with employees due to offices and branches closing down or to a decrease of the financial benefits. We have noticed a general need of our clients to secure as much as possible any transaction/contract or to recover any debt from their partners. On the other hand, stronger companies are trying to take advantage of some opportunities created by this financial downturn. To give an example, it is much more profitable to purchase Real Estate now, than it was 2 years ago. All of the above, have to go through the Legal department, more or less. As our company is concerned, we have successfully managed to overcome this crisis, due to our quality orientated services and our high adaptability against new economic environments.


a) When was the firm set up and how do you position yourself as a law firm? Established in 2001, Grosu & Asociatii has gradually earned its way up towards the top ranked companies which put a great value on the quality of services, responsibility and client’s satisfaction. Within the last 9 to 10 years we have grown to be just under the medium sized companies in the legal services market, with a personnel of almost 20 people (attorneys and auxiliary). b) What type of services do you offer? What are your main practice areas? We provide legal services in the areas which are specific to trade companies. To make a parallel, we are like an externalised legal department with all the resources required to successfully support the client’s business, starting with its founding. To be more specific, we handle a large variety of law areas such as Trade Companies, Real Estate, Labour Law, Commercial Law, Communications and Internet, Intellectual Property, Arbitration, Disputes, Enforcements and Recovery of debts. Given the complexity of business, on day to day



Patriciu’s next business model: little is the new big percent. “The business adventure we are embarking on aims to annihilate modern retail, which does nothing but destroy the urban fabric. We want people to go to hypermarkets less often, once a month at the most, and go to the stores around the corner of their apartment block in their slippers. If I have a wish, it is that the commerce imported piecemeal from the West should die,” said Patriciu passionately. He added that he had developed the concept with Mercadia executives down to the very last detail, and was not inspired by the business model developed by the big European retail groups. Moreover, he criticized foreign retailers, saying they imposed a retail format incompatible with local realities on the market.

With EUR 200 million of investments plans, Romanian businessman Dinu Patriciu has found what he hopes will be a golden goose: a traditional store network which is estimated to reach 1,000 fixed shops and 2,000 mobile outlets on wheels by the middle of next year. According to Patriciu, the break-even point is estimated for April 2011, 12 months after the business was developed. Why retail? Patriciu’s forthright answer: “If I have a wish, it is that the commerce imported piecemeal from the West should die”.



Dan Ionescu, CEO of Mercadia group, and Dinu Patriciu, the owner of the retail chain

Dana Verdes When you think of Dinu Patriciu, you think of oil. A few years ago, when he was still running Rompetrol operations – “a business based on passion” as he has called it – who would have believed that he would leave this sector and that we would see him at the helm of one of the most explosive businesses on the local market – the retail network When he recently stated that break-even was estimated by the company for April 2011, 12 months after the business was set up, it suggested that he had a successful businesses recipe. According to Patriciu, the total investment in is estimated at EUR 200 million and in the six months since the network has been opened it has swallowed up EUR 30 million.



The development strategy is pretty clear, says Dan Ionescu, Mercadia Group CEO. “Now we have 100 fixed traditional stores. A new development direction is to form a solid network of mobile stores. These 10

stores are developed on a 3.5-ton car platform. We have already inked a contract for the platforms with car importers Autoitalia and Casa Auto. We plan to reach 2,000 mobile units and 1,000 fixed stores by next year. We will expand in concentric circles around Bucharest, meaning Ploiesti Pitesti, Urziceni and Alexandria,” said Ionescu. Plans for the shops on wheels’ deliveries are well underway. “This month we will have delivered some 30 platforms, next month about 30 cars, in December 50 units and from January 2011 they will start delivering about 120 units on a monthly basis. All the cars will be ours but the maintenance will be done by the two car importers,” said Patriciu. He added: “We plan to expand all over the country. The idea of this business is to have a store every 800 meters in urban areas”. Patriciu estimates that will reach a EUR 150 million turnover by year-end. But his development plans do not stop here. In August, Patriciu acquired the miniMAX Discount store chain, which now includes 36 shops in 33 cities. These outlets have a commer-

cial area of 750 sqm, equipped according to European standards, and every store offers over 2,000 products at low prices. “Currently we have 36 miniMAX stores and we’re planning to open another one this week. The miniMAX network has 700 employees and a 7 percent market share for the first seven months of this year. Our strategy is to reach 150 miniMAX stores by the second half of next year,” said Ionescu. According to him, miniMAX was bought to provide the logistics platform for the entire network. miniMAX will be rebranded and repositioned. It will become a traditional store but with the same discounter policy.




The business wasn’t all milk and honey at the beginning when the network was buying around 80 percent of its products from Metro. Patricu said it was an unfortunate experience for the founders because Metro could not deliver all the quantities the firm needed, just some 40-50


Patriciu said that the estimated turnover for 100 stores is some EUR 36 million and with its grand expansion plans the company is clearly aiming for billions of EUR of sales, more than even cash & carry stores. “Some 90 percent of products sold in stores will be manufactured locally, which will allow us to charge low prices, while factoring in the development of own brands in partnership with Romanian producers,” said Patriciu. A store will cover an area containing 300-400 families and will have to attract some 500 customers per day, up, from the current figure of 300. Patriciu’s commercial plans are ambitious, considering that the three major networks active in the supermarket field – Carrefour, Real and Kaufland – who have each invested about half a billion EUR in expansion in Romania in the last five-ten years have not yet reached the sales threshold of EUR 1.5 billion. According to Patriciu, his stores will rediscover the traditional ways of doing business in communities. For instance, company officials say the shops will be able to sell on credit. Shoppers can take out a card with a RON 300 limit from the store to buy groceries, which, according to company information, will be issued based on the quality of the relationship between customer and grocer. The customer will pay a monthly fee of RON 4. “The card can be used only in the store where it was issued. We started BUSINESS REVIEW / October 11 - 17, 2010

FOCUS in figures April 2010 set-up date for retail network

EUR 200 million estimated investment in network COURTESY OF MIC.RO

The ideal associate for a store is a Romanian family, Patriciu says

this program a month ago. Since then we haven’t had any payment problems,” said Ionescu.



Patriciu said that in his opinion the ideal associates to run the stores are young, intellectual family people. The Mercadia Group CEO said courses were being organized for the associate position. “The fee is EUR 400 and those interested must present a EUR 7,000 warranty per

BUSINESS REVIEW / October 11 - 17, 2010

unit, which will cover any undue losses by the store,” said Ionescu. “The goods from the store are owned by our company, and we cover all the rent for the premises of the network. We guarantee a minimum gain of EUR 2,500 plus a share of sales. But from this sum a minimum of three employees must be paid. Also, all employees must be trained,” said Ionescu. He added that the store manager will earn a net salary of RON 1500 plus a RON 300 bonus if the targets are met.

EUR 150 million estimated turnover by year-end

3,000 stores 1,000 fixed stores and 2,000 mobile ones by mid of next year

April 2011 break-even time for

EUR 7,000 the cost of the warranty to become a associate

70 sqm

minimum surface of a fixed store



Local wine producers have the bottle to do battle on global market

Simona Bazavan Local wine producers haven’t been toasting 2010, with the Romanian market estimated to have dropped by as much as 15 percent against 2009. The blow was even harder for premium and medium wine segments as Romanians, mostly unsophisticated wine consumers, bought less or shifted towards cheaper and sometimes counterfeit brands. Mature markets have been less affected by the decline in purchasing power. “Unlike Romania where there have been significant drops in wine consumption, external markets have remained constant, proving well established and traditional consumption patterns,” said Jean Valvis, president and GM of Valvis Holding. There are world-famous French, Chilean, South African and Australian wines but very little is known about Romanian labels. The lack of a national promotional strategy for this industry has left local producers to do battle on the global 12


From acknowledged potential to international awards, Romania has all the required ingredients to brand itself and become globally known as a wine producer. But it has failed to do so, lacking a national promotional strategy and coherent support from the authorities. Against this backdrop, local produces are struggling to make a name for themselves and uncork international markets.

Wine producers don't expect a spectacular comeback for the local market in 2011

market alone. “Competition on external markets is fierce and it makes it very difficult to sell a lesser known wine, even though as far as quality goes that wine is at the level of those produced by top players on the world market,” Dan Muntean, general director of Cramele Halewood, told Business Review. Change can happen only with long-term strategies and considerable financial efforts on behalf of local producers, added Ioana Anghel, PR Manager at Jidvei Romania.



More and more local wine producers are turning their attention to Asia, driven by the opportunities of its emerging wine markets, with China the most alluring for Romanian companies by some way. “China is a huge market which hasn’t yet been affected by the economic crisis. Estimations indicate a market volume of about 91 million liters, approximately 121.4 million bottles with an average price of USD 3.12 per bottle, according to

market research by Baharat Book Bureau,” said Angela Mares, marketing director of Vinexport Romania. Recently wine producer Tohani took its interest in the Chinese market a step further and announced plans to build a wine factory in China following a EUR 20 million investment. “This is the largest Romanian investment in China so far and we will start producing next year. We have 600 ha of land for the vineyard provided by the Chinese authorities who have also thrown in a five-year tax exemption,” Virgil Mandru, main shareholder of Tohani, told BR. The winemaker is still negotiating a subsidy for the factory building costs with the Chinese authorities. Tohani brings three premium wines to China, The King’s Wine, The King’s Treasure and Tohani Castle. A fourth could soon follow, “as soon as we find a proper way to translate ‘Sange de Taur’ into Chinese!” Mandru added. Until 2012 when the factory should be finished, Tohani will continue exporting to China. Before considering this investment, Man-

dru said that the company had looked at various strategies to boost exports which were unlikely to success because of the obscurity of Romanian wines. Tohani is planning a similar EUR 10 million investment in a bottling facility in Poland. The two projects are being developed in partnership with local companies, with Mandru financing 50 percent of the two investments. He added that the two locations were chosen for their potential and easy market access. On the local market Tohani is preparing for a fall this year. “We expect the local market to drop by 12 percent this year against 2009. The drop will be more significant on the medium and premium segments,” Florin Timau, marketing director for Domeniile Viticole Tohani, told Business Review. As for 2011 the company is forecasting that the internal market will level out and perhaps even resume growth. The company’s most famous brands are Sange de Taur, Domeniile Tohani and Princiar and Tohani estimates that it has a 5 percent market share (0.75 l bottles). The wine producer has seen its business grow by 40 percent in the past five years. After posting a EUR 14 million turnover in 2009 the company is expecting lower results in 2010. Last year Tohani exported wine worth EUR 500,000 to the USA, Germany, Italy, Norway and Spain. Local wine producer Vinexport Romania plans to increase its exports to the Asia-Pacific region in the following months, targeting sales worth EUR 1 million on the Chinese market by the end of the year. And this is only the beginning, the producer says. Sales in China, the company’s main export market, represented 2.8 of the company’s turnover last year. For 2010, the company plans to increase this share to about 10 percent. Vinexport produces the Gurban, Vinul Vanatorului, Puterea UrBUSINESS REVIEW / October 11 - 17, 2010



Chinese consumers get the taste for Romanian wines at an exhibition in Hong Kong

sului, Putna, Centenar and Weisser brands, all of which are exported to China. By 2012 Vinexport plans to supply 1 percent of China’s wine imports (in 0.75 l bottle). Local winemaker Jidvei is also putting China on its to-do list. The company is currently exporting to the USA, Germany and Japan among other markets. “Until recent years we hadn’t focused on exports as internal sales were enough for our production. This is why we exported only 3 percent. Things have changed lately and not only due to the economic situation,” says Anghel. Increased capacity production and the success enjoyed after winning international prizes made the company consider a more aggressive export strategy. Jidvei has a production capacity of 10 million liters and is best known for the Dry Muscat (“Fata-n iarba”), Feteasca Regala (“Tarancutele”), Riesling (“Banuti”) and Sauvignon Blanc (“Premiat”) wines.



Jean Valvis, creator of the Dorna and LaDorna brands, says he has invested EUR 12 million so far in the grapes and wine industry at Samburesti vineyard. This summer the company launched three wine varieties, Domeniile Samburesti (premium segment), Samburel de Olt (medium and superior segment) and Chateau Valvis (an exclusive collectable wine). “We are still in an early stage. Exports are an important objective for us and we are currently prospecting potential markets such as the USA, Europe and Japan,” Valvis added. Wine producer Halewood said it was trying to keep a balance beBUSINESS REVIEW / October 11 - 17, 2010

tween exports and the domestic market. “Exports have gone down in the past few years as some of our clients have been hit by the economic crisis much harder than Romania,” Muntean added. The producer exports to about 40 countries. About 15 percent of its exports go to Asia but Muntean says that now the US has the potential to become the largest wine market. “Along with five other wine producers we have set up an association to access European funds for the promotion of Romanian wine in the US,” the MD said. The project is estimated at a value of around EUR 2.5 million and will involve a three-year promotional campaign. Halewood announced a 2.3 percent turnover increase for 2009, taking the figure to EUR 9.8 million and this year it expects to make EUR 10 million. Among its bestselling labels are the Prahova Valley Reserve, Special Reserve, Halewood Special Reserve Feteasca Alba and Feteasca Neagra, Private Reserve Feteasca Neagra , Rhein, Hyperion and its HoReCa brand, Single Vineyard Selection. In spite of the bleak market results in 2010, especially on the premium segment, some businesspeople are still venturing into putting money into wine producing. Newcomer WineRo is the company behind the creation of a new Romanian wine, Alira. The markets that the new brand will target, besides Romania, will be the same as those for EniRa, the Bulgarian wine that WineRo distributes in Romania (as they are part of the same group, Bessa Valley).Out of the total volume, 20 percent will be exported to France, Luxemburg, Great Britain, Germany, Switzerland, Czech Republic, China, South Korea, Taiwan and Japan. 13



Inna strength - local star plans foreign assault With over 600,000 singles sold in France and Great Britain so far and around 70,000 albums flying off the shelves in France alone, Inna is one of the top rated Romanian artists of the moment. An example of online success, her song Hot has reached almost 30 million views on YouTube, and continues to gain popularity among social media platform users. Business Review sat down with the singer and her management to try to discover the secret of her success and plans for the future. Corina Dumitrescu Dance music has been fertile territory for performers of Romanian origin for quite a while now. OZone proved it in the early 2000s, and former member Dan Balan (aka Crazy Loop) continues to do so, the Cheeky Girls improbably did it in Great Britain and Morandi are making quite a few waves beyond Romanian borders to name but a few. Inna shot to fame in 2009, when her first single, Hot, became one of the most played songs on TV and radio channels, shortly reaching number 1 in the national Nielsen Airplay Chart and later attaining airplay in places such as Russia, Poland, Bulgaria, Serbia, Slovakia, Greece, Belgium and the Netherlands. The singer is now the winner of a Platinum Disc in Spain and a Golden 14

Disc in France, where she has sold over 50,000 records and been invited onto several radio shows to perform unplugged versions of her hits. In Romania, however, the situation could have been a lot better. Inna’s sales were respectable, but “the majority of sales and gains came from abroad,” say Global Music Management officials. The 24-year-old from Mangalia (a town on the Romanian Black Sea Coast) started studying music at eight years old and had a pop-rock project before dabbling in dance music, which she gave up as it brought no success. She cites Pink as her inspiration. Inna attributes the Romanian music industry’s lack of international headway to insufficient promotional budgets, as well as “the lack of constant results on an international level.” But she hasn’t given up hope. “Romanian music

has grown considerably in recent years, it can be heard all over Europe. But we still have a lot of work to do.” Constancy appears to be one of the singer’s secrets, as Inna has quickly launched one new song after another, without making major changes to her look or sound. In the United States, after being signed by the independent Ultra Records label in 2009, the Romanian recording artist soared to the top of the Billboard chart, the Hot Dance Airplay section, with Hot. At the MTV Europe Music Awards 2009, Inna won the Best Romanian Act section, while at the Romanian Music Awards she took 4 of the 16 gongs. The independent label from New York that signed Inna has a portfolio that includes Armin van Buuren, Dannii Minogue, Fedde Le Grand, Kraak & Smaak, Morcheeba, Panjabi MC, Paul Oakenfold, Paul van Dyk, Tiësto, Timo Maas, Tom Novy, as well as Romanians like Akcent and O-Zone. Image is also very important in Inna’s promotion. Her sweet and daring persona presents a friendly and warm side to her fans. While Lady Gaga has set the trend for outin-the-open and controversial sexuality, Inna’s sexy outfits are less shocking and more playful. At the MTV European Music Awards, on November 5 2009, in Berlin, Inna got quite a reaction on the red carpet, thanks to her tight red pants and transparent top, hogging the spotlight for several minutes and delaying the entrance of other artists, according to her official website. Such controversy may seem premeditated, yet Inna argues that while “image is a very important aspect of any public figure, artist or not,” she has

not put very much thought into it. However, she admits to having been helped by her looks and outfits. Inna’s image has been the focus of many of her videos, created by internationally acclaimed directors. The video for 10 Minutes was filmed in London, directed by Paul Boyd, known for his work with the likes of Celine Dion, Shania Twain, Tina Turner and Kylie Minogue. From the outside, Inna’s success seems like an overnight and almost fairytale happening. In the eyes of the singer’s management team, however, what lies behind the singer’s popularity beyond Romania is “her very good voice, excellent stage presence and passion for what she does. Inna is an artist who helps you very much with her promotion”. The singer says she earned her fame through constant work and always aiming higher. As she puts it, “These results only make more ambitious to attain more.” An effective online promotional campaign boosted the singer’s career in the era of virtual communication. “Social networks have helped us gain direct contact with fans, see their reactions and get closer to them. We offered them constant content, through pictures, videos or simple updates regarding Inna’s career, as they appreciate this kind of thing,” Global Music Management representatives tell Business Review. Although the singer says that she does not have her own Facebook profile, “I do send messages to my Facebook and Twitter pages,” adds the chanteuse. So far, Inna has attracted over 835,000 fans on Facebook, almost 30 million views on YouTube for Hot and around 10,000 comments on the

Inna in numbers: é Years active: 3, since 2007 é Estimated fee for a concert in Romania: EUR 4,000* é Estimated fee for a concert outside Romania: EUR 8,000* é Singles sold in France and Germany: 300,000 é Albums sold in France: 70,000 é Number of fans on Facebook: over 835,000** é Number of followers on Twitter: over 20,000** é Peak position on Billboard Hot Dance Airplay chart: 1 é Views on YouTube for Hot video: almost 30 million** é Views on YouTube for Sun is Up video, one week after launch: over

1,000,000** *data from Roton Music Label **not including unofficial fan pages/posts

BUSINESS REVIEW / October 11 - 17, 2010




Romania’s answer to Lady Gaga? Both singers have no fear of taking chances for their careers

Local pop sensation Inna is looking optimistically to the future

same video. Behind the singer’s success is an enduring collaboration with Romanian composers from Alba Iulia, Play & Win, made up of Sebastian Barac, Radu Bolfea and Marcel Botezan, who have also written for other top Romanian artists, like Akcent, Activ, Andra and Sistem. Inna’s Romanian origins have not affected her road to fame, she says,

Sad, Serbia Each success story brings some criticism, and Inna has not been spared. Many commentators say that more talented artists showing less skin do not receive the same degree of attention or that the artist should perform in Romanian, her native language. But she counters, “If you want an international hit, it must be in a language of interna-

BUSINESS REVIEW / October 11 - 17, 2010

while her management argues that they have been an impediment which they have managed to overcome. Political tensions between Romania and France, for example, have not stopped the artist from being invited on several shows in the country and also receiving a Golden Disc for her record sales. The singer’s favorite performance abroad so far was, however, in Novi

tional circulation.” O-Zone’s Dragostea din Tei (or the Numa Numa song as Americans call it) “was an exception,” concludes the singer. Inna has announced that she will most likely release a new album in 2011, although it may be too early to talk of her follow-up disc, as her first album has only just been released in some countries.



Matching up Romania’s lonely hearts In an era of speed, when time is a luxury that few can afford, finding a soul-mate seems like the challenge of the century. Romantics may disapprove, arguing for a more spontaneous kind of love, but facts and figures show that there is increasing demand for STOCKEXCHANGE

matchmaking and dating services in an ever more modern Romania. Corina Dumitrescu Although the traditional way of finding love now means eyes meeting across a crowded room and butterflies in one’s stomach, with fate acting as Cupid, things have not always been like this. It was not so long ago when families married off their young or members of the clergy intervened between members of their flock. Matchmakers, too, have existed since times immemorial in almost every corner of the world. But in today’s time-pressed society they are back in demand, and Romania is no exception, quickly aligning to global trends. In Romania, dating services currently consist of traditional matrimonial agencies, online dating firms (socializing sites), matchmaking agencies, as well speed dating and events companies, according to research undertaken by matchmaking agency Umbrella for Two. The local dating sites have reached a total annual turnover of around EUR 2 million, found the same source, and 16

Matchmaking is gaining ground as an increasingly sought service for time-strapped Romanians

represent 50 percent of the dating market, supplying free access to those interested in socializing, while 32 percent of the market is made up of online dating sites and 15 percent traditional matchmaking agencies. Matchmaking agency Umbrella for Two, which pitches itself as the only matchmaking and headhunting agency on the market, emerged in a context in which so-called premium clients, meaning the middle-upper and upper class, were being neglected by local dating services. According to the research done by the company, it appears that there are almost 630,000 single people aged between 18 and 65 in this premium category, 180,000 of whom are in Bucharest. This group basically consists of entrepreneurs, freelancers, top and middle managers, technocrats and clerks in the services area, among others, with incomes between EUR 800 and 1000. From this perspective, matchmaking is done more in terms of recruitment, abiding by the same rules of rigorousness that corporations use to find new employees. “We will surely see a growing

trend of people willing to ask for professional support in the outsourcing of the search for the right partner for a long-term relationship – just as when we look for a job, we head towards recruitment agencies. What’s more, the selection of profiles in accordance with the client’s requirements are a time and effort benefit on his or her behalf,” says Umbrella for Two managing partner and matchmaker Oana Totora, who has solid experience in human resources and recruitment services in Romania. The fees for the matchmaking service provided by the agency that Totora manages range between RON 250 and RON 1000, VAT not included. As a first stage, the service basically consists of a so-called emotional interview, in which the matchmaker gets to know the client, his or her interests, expectations and lifestyle, creating his or her “emotional CV”. Then, a selection process is started and other users’ profiles are recommended, from whom a shortlist is drawn up and if the choices coincide on both sides, a first date is arranged. If the two de-

cide that they want to continue their relationship after meeting a few times, they enter a standby period of six months, during which they may seek consultation services from the agency to help with the next steps of their relationship. An interesting aspect concerning Umbrella for Two is that the headhunting – or perhaps hearthunting – process has an emotional level, recruiting top singles in Bucharest from various social events in the city. Even though Umbrella for Two has been active since early 2010, it has already had success stories, with some clients engaged to be married. In the near future, Totora hopes to expand the agency (which currently consists of three employees) to other major cities in Romania, such as Timisoara and Cluj. More about the agency can be found on www. A growing trend on the Romanian dating market is speed dating, a time-efficient means of meeting a potential “the one”. Singlebell provides such a service in Bucharest, promoting dynamic offline romance since January 2010. The service consists of a meeting between seven women and seven men who talk to each other through rotation for seven minutes during each session. Participation costs RON 40, which also includes a drink at the location. “What we are currently focusing on is making the concept popular and gaining Romanians’ trust, as they are currently skeptical of the seriousness and efficiency presented by these meetings,” says Valeria Simona Ion, founder of Singlebell. “What sets us apart from other similar firms is that we do not omit the matchmaking stage of our service. We select the evening’s participants, depending on their level of education, profession, age, hobbies, as well as aspirations.” After the meetings, she adds, feedback is offered, as well as consultancy on dating and relationships. Singlebell’s clients have an active social life, lack the time to look for a partner, are aged between 21 and 45 and have gone through higher education. In just a few months of existence, the agency has had success stories with couples who met for the first time in the speed dating sessions. BUSINESS REVIEW / October 11 - 17, 2010

PROPERTY Novartis relocates to Polona Business Center Hypermarche to open 9,000-sqm Cora visers/Knight Frank, the exclusive agent representing the company in the transac- hypermarket in Galleria Arad

The local subsidiary of Swiss healthcare company Novartis has decided to relocate its Romanian offices to Polona 68 Business Center, announced the Ad-

Bucharest second to bottom for doing business – Cushman & Wakefield survey


Bucharest ranks 35th in the Cushman & Wakefield survey, European Cities Monitor, for the best European cities in which to do business. The Romanian capital is currently second to last, just above Athens. London is still the leading city in the table, with a similar score to 2009. Paris remains in second place and Frankfurt in third, with the gap between second and third place closing slightly. Brussels regains fourth place from Barcelona, while Amsterdam moves back up the ranking to sixth. Bucharest declined in the ranking of cities with This year the most impressive the best cost of staff rise is seen by Vienna, going up six availability of qualified staff the places to 22nd. Bucharest also declined in the second most important issue.The chart of cities with the best cost of quality of telecommunications and staff. While last year it came first transport links with other cities refor this indicator, this year it has main in third and fourth place refallen several places. Bucharest is spectively. Overall, these four facnow preceded by Istanbul in fourth tors are still the most important, place from second last year. Warsaw with over half of the sample continregained its first place in this cate- uing to class these issues as abgory. Easy access to markets, cus- solutely essential when deciding tomers and clients remains the most where to locate a business, the suressential factor when deciding vey found. Otilia Haraga where to locate a business, with the

BNP Paribas Real Estate Property Management buys Central Europe Property Management business from AEW Europe BNP Paribas Real Estate has bought the property management subsidiaries of AEW in Central Europe (PBW Polska, PBW Hungary and PBW Czech Republic) in a move to consolidate its activity in Central Europe. The three PBW companies, which have a global turnover of EUR 5 million and employ 70 local market specialists, have been operating for fifteen years, with four offices in three counBUSINESS REVIEW / October 11 - 17, 2010

tries: Poland (Warsaw and Gdynia), Hungary (Budapest) and Czech Republic (Prague). Focused on offices and shopping centers, they manage a portfolio of high quality assets totaling 350,000 sqm. PBW Hungary, Poland and Czech Republic will adopt the brand of BNP Paribas Real Estate, which will increase its presence to 17 countries, not including alliance agreements.

Retailer Hypermarche will open a 9,000-sqm Cora hypermarket in Galleria Arad, GTC, the developer of the project, has announced. Other brands the developer has signed up so far include Reserved, House of Art, Leonardo, Sprider and Cinema City. Galleria Arad, which is set to open in the fourth quarter of 2011, is 60 percent leased. The project offers 33,000 sqm of leasable area, and required a EUR 70 million investment. It is being financed by the European Bank for Reconstruction and Development, and is located on the main artery of the town, Aurel Vlaicu Street. GTC Romania is developing the Galleria chain of shopping malls in partnership with Aura Investments. GTC holds 85 percent of the shares in Galleria Arad while Aura Investments holds the remaining 15 percent. The ‘Galleria’ brand is the name under which GTC develops shopping and entertainment centers in Central and Eastern Europe and now in Romania and Bulgaria. Be-



Novartis leased 1,686 sqm on a five-year contract

tion. The deal started at the beginning of spring and was completed this month. From next year, Novartis will relocate its Romanian headquarters to the fifth floor of the office building located on Strada Polona Street, in the immediate vicinity of Piata Romana. The company leased 1,686 sqm, through a five-year contract. The office building was developed by EEC Invest Development. It has approximately 10,000 sqm GLA class A office space, on five floors.

Cora will take up a 9,000 sqm surface

sides Galleria Arad, GTC Romania owns three more shopping centers under operation in Buzau, Suceava and Piatra Neamti. It has another shopping center project in the pipeline in Galati, construction works on which will start by next year. GTC Romania is the subsidiary of Globe Trade Center S.A., which has been active in Central and Eastern Europe since 1994. GTC invests in three main sectors of the real estate market: shopping and entertainment centers, office buildings and residential property.

Poland drives growth in CEE property investment Central and Eastern Europe attracted EUR 1.5 billion in property investment in the third quarter of this year, a survey by CB Richard Ellis has found. This is the largest growth in Europe at this time. Compared to the previous quarter, the growth is approximately 60 percent, while against the same period of 2009 it is 119 percent. The growth was driven mostly by an increase in confidence in the Polish market, where more than half of the CEE in-

vestment – EUR 826 million – went. “Poland was the only European market that had managed to avoid recession, and at the beginning of the year prices did not reflect the fact that Poland is currently an important market for many investors,” said Jonathan Hull, head of EMEA Capital Markets with CBRE. Overall Europe attracted EUR 23.1 billion in investment in Q3, slightly lower than the EUR 24.6 billion invested in Q3 of 2009.

Rockefeller Group buys Europa Capital LLP Rockefeller Group International (RGI) has acquired a majority interest in Europa Capital LLP, a London-based European real estate fund management group which owns properties in Romania as well. The deal is said to be creating a global real estate investment management platform, with Europa providing access to investment opportunities in

European real estate, across multiple risk/return strategies and asset classes. Europa has raised six real estate funds, and invested over EUR 6 billion in 17 European countries since 1995. RGI is a private corporation focused on the ownership, development, investment and management of commercial real estate. Established in 1928, RGI is owned by Mitsubishi Estate Co.

Cocor store attracts 20,000 visitors in first two days The Cocor store, which reopened last week following an investment of EUR 25 million, saw traffic of over 20,000 visitors, store representatives announced. The opening day attracted 10,500 shoppers. Reconstruction works on the store started in 2008. Besides

seismic consolidation, refurbishment increased the built surface from 10,000 sqm to 25,000 sqm, while the rentable area grew from 6,000 sqm to 10,000 sqm. The store is currently 85 percent occupied. The rent per sqm is EUR 40 without VAT, plus EUR 10 for utilities. 17


Charitable concert in aid of struggling young artists at Romanian Athenaeum

On the occasion of King Michael’s 89th birthday, on October 25, the Principesa Margareta Foundation will organize the third edition of a charitable concert held to raise funds to support young artists of limited means. Soprano Nelly Mirincioiu and baritone Yuryi Tsiple, together with Orches-

tra Romana de Tineret (the Romanian Youth Orchestra), conducted by Horia Andreescu, will stage this year’s royal concert, which also marks 20 years since the birth of the foundation created by Princess Margarita. The evening’s program will include pieces from operas by Giuseppe Verdi, Giacomo Puccini, Florin Comisel, Ludwig van Beethoven, Mikhail Glinka and Gioachino Rossini. Ticket, which cost between RON 150 and 300, are available in the Eventim store chain, as well as online at The funds raised from the concert will go on instruments, courses and contest fees for young Romanian artists. Nelly Mirincioiu, Yuryi Tsiple and Horia Alexandrescu will donate their concert fees for the purpose. Corina Dumitrescu


Auctions gain ground with art lovers in Romania

Galben (Lila in Yellow) each sold for EUR 50,000 while Nicolae Darascu’s Natura Statica cu Bujori si Carti (Still Life with Peonies and Books) went for EUR 42,000. Corina Dumitrescu

British new wave phenomenon Hurts play Bucharest this autumn On November 11, en vogue British band Hurts will hold their first concert in Romania, at Silver Church Club, in Bucharest. This will be the band's second time in Romania, after filming the video for Better than Love in Bucharest at the start of the year.The band’s most recent album, Happiness, released on September 6, became the best sold recent debut album on the British music scene. Only a week after its launch, the album had sold over 150,000 copies. Hurts are a synth-pop duo from 18

Camera, roll, action for fourth Kinofest

competition supporting the Campaign for Breast Health, for which submissions are invited by October 27 to Corina Dumitrescu

Destinies at Crossroads, an exhibition of Hebrew artists during the Holocaust

Nicolae Grigorescu's Bullock Cart sells for EUR 155,000, less than expected Works by Grigorescu, Luchian and Ressu were put up for sale as part of a Romanian Impressionism and Postimpressionism auction organized by Artmark last month. The event reportedly enjoyed a record turnout, as well as the highest award rate, of 88.2 percent, and highest total number of sales among the Romanian auctions organized so far, the first official data from Artmark show. Grigorescu’s Bullock Cart was initially tipped to go for over EUR 200,000, but was sold for EUR 155,000, becoming the second most expensive painting after Camil Ressu’s Aise, which was auctioned this summer for EUR 160,000. Stefan Luchian’s Trandafiri (Roses) and Francisc Sirato’s Lila in

Kinofest, the first digital film festival ever organized in Romania, now on its fourth run, will last longer than in previous years, totaling five days instead of three. Films, concerts, events and exhibitions are part of the schedule of the event, which takes place between November 3 and 7, at the National Museum of Contemporary Art in Bucharest. Kinofest 2010 includes three competitions (in the Animation, Fiction and Micromovie sections), with three separate juries and only one winner for each category. Participation is open to any filmmaker or animator, whether professional, student or amateur, with registration by October 8. Kinofest will also be hosting the second Avon Movie for Life, the short-film



The Athenaeum stands for charity on October 25

Digital Film Festival Kinofest, five-day challenge of audiovisual sensations

Manchester composed of vocalist Theo Hutchcraft and synth and guitar player Adam Anderson, who began performing together in 2009. The band collaborated with Kylie Minogue on their debut album, on a song entitled Devotion. Tickets for the concert cost RON 50 and are available in Orange shops, the Evetim store chain, as well as online on and The Silver Church Club is located on Calea Plevnei 61. Corina Dumitrescu

From October 13 until February 13, the National Museum of Art in Bucharest will host the Destinies at Crossroads – Hebrew Artists during the Holocaust exhibition, organized on the occasion of Holocaust Day in Romania, October 9. The exhibition presents the works of 16 Hebrew artists who made major contributions to introducing “new art” in Romania, some of whom are regarded

as pioneers of the Western avant-garde movement, including Victor Brauner, Marcel Iancu, Arthur Segal, Jules Perahim and Max Herman Maxy. The official opening of the exhibition will take place on October 11, at 19.00. Tickets cost RON 8. The National Art Museum (Muzeul National de Arta al Romaniei) is located on Calea Victoriei 49-53. Corina Dumitrescu

UK, Romanian and Icelandic efforts get plaudits at Filminute festival After a month of online screenings, Filminute 2010 has announced the award winners for this year’s film festival. Choose not to Fall was selected for the top honors by the seven-member international jury of the one-minute film festival. It is the first time that a documentary has won. The online festival audience from 124 countries, with each viewer permitted one vote only, chose the Romanian comedy A New Prayer for the People's Choice Award. It edged out efforts from Iceland and South Africa to win the popular vote. The top-rated film was Dark Valley, an inventively frightening film from Iceland that takes place in an SUV standing in the frozen tundra. “The range of countries and stories on the jury’s commendation list support what we said when we started Filminute in 2006: one-minute films level the play-

ing field. These films prove that no country has a monopoly on great stories,” said Filminute co-founder Sabaa Quao. Founded in 2006 by John Ketchum and Sabaa Quao, Filminute is an international film festival run by staffers in Bucharest, London, Toronto, Vancouver and Panama. Each year, the festival experiments with different platforms to complement the main site, Facebook being a big hit this year. This year’s jury was made up of Neill Blomkamp, the South African director of District 9; Mark Tutsell, global chief creative officer for Leo Burnett Worldwide; Jan Lumholdt, the Scandinavian film critic for the popular Swedish daily newspaper Svenska Dagbladet; film historian and critic Ronald Bergan; and Indian director and writer Tanuja Chandra. Founders Ouao and Ketchum are on the jury as well. BUSINESS REVIEW / October 11 - 17, 2010

Business Review No.37, October 11 - 17  

To proximity and beyond Dinu Patriciu is now focusing on expanding the chain of proximity stores and has EUR 200 million available f...

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