The Initial Public Offering (IPO) of Kaolin starts 18 April 2007. The deadline for submission of subscription applications is 20 April 2007, 17:00 PM. Investors can apply in Bulbank AD directly or through their investment intermediaries, Kaolin announced.

Purchased shares should be paid between 23 and 25 April 2007. Trade in Kaolin’s shares is expected to begin on or around 28 May 2007.

Kaolin AD offers up to 5 mln new shares as a capital increase. Up to 1 mln of the existing shares will be offered to the majority shareholder Alfa Finance Holding AD within the IPO.

The IPO will be considered completed if at least 3 mln new shares have been sold.
The minimum price of all offered shares has been set at 12.50 leva per share, the issue value will be determined using the “book building” mechanism, managed by Bulbank, part of the UniCredit group.

After the capital increase all sold new shares will be included in Kaolin AD’s capital at their issuance price, which will provide the company with resources for new acquisitions and investments in the Balkan and Eastern Europe region.

The company’s own capital is expected to grow to 85-90 mln leva compared with 38.3 mln leva in the end of 2006. Currently Kaolin’s registered capital is distributed in 20,419,380 shares. After the planned capital increase at least 20% of it will be traded (free float) by investors.

After the successful IPO, Kaolin AD intends to maintain a consistent dividend policy, allocating at least 20% of its net profit as dividends.

Kaolin AD is a Bulgarian company, regional leader on the market of base materials for glass, ceramics, constructions, etc. in South East Europe, North Africa and the Middle East. Its main products are high quality quartz sands, kaolin, limestone and other industrial materials, as well as a series of added value products based on the materials mentioned above.

The long-term strategy of Kaolin includes development of new production lines of high growth potential in the field of construction materials, ecology and other rapidly developing sectors. Part of the company’s plans is to make serious investments in energy efficiency, to develop waste-free technologies and to automate the main productions of kaolin and quartz sands.
Kaolin AD is also considering greenfield investments and acquisitions in Bulgaria and all countries in Central and Eastern Europe.

Kaolin’s consolidated revenues increased 28% from 70.3 mln leva in 2005 to 90.1 mln leva in 2006. Its net profit grew 30% from 7.25 mln leva to 9.43 mln leva. EBITDA was up 40% from around 13 mln leva to 19.9 mln leva.

For the past 7 years Kaolin’s sales have been growing at an average annual rate of 25%. The net profit of the company has been expanding at an average annual rate of 100% for the past 3 years.

Alfa Finance Holding AD has been the main shareholder of Kaolin AD since the middle of 2000.