The bank has completed an almost 10-month due diligence on the fund before taking that decision.
Manolov also said that a total of 900,000 decares of agricultural land traded hands last year, compared with 500,000 decares in 2005. The prices have soared to above 300 leva, against 50-80 leva two-three years ago.
“In the long term run the agricultural land market in the country will stay stable and we expect it to grow by 20-30% each year,” he added.
There is a 30% hike in H1 this year only.
At the end of June Advance Terrafund controlled 238,000 decares of land, of which 70% is leased out. The fund expects revenue from leases for the 2007-2008 period to come to 2 mln leva, which is 150% up y/y.
The fund intends to hike capital from 44.056 mln leva (22.5 mln euros) to 110.14 mln leva (56.3 mln euros) via issue of 66.084 mln shares at a par value of 1.90 leva. This is the second biggest capital increase in the history of the Bulgarian Stock Exchange.
“We will use the funds to repay a 15 mln leva loan and the rest will be invested in purchases of arable land near big cities in Bulgaria.”
Investing in land has gained much popularity both in Bulgaria and globally in the past years, Manolov said in conclusion.