Slovenia seen as attractive investment destination

Slovenia’s attractiveness as a destination for greenfield investments as well as acquisitions was highlighted at a special Bled Strategic Forum panel entitled InvesTalk Slovenia 2.0, which was organized in partnership with the Bank Assets Management Company (DUTB).

Dr Imre Balogh, CEO and Executive Director of DUTB, outlined DUTB’s role in the Slovenian business environment, describing it as “a key channel for investments”. While it has been cashing assets at a fast pace, it still has roughly EUR 600m in claims, EUR 200m in real estate and EUR 100m in equity on its books, according to Mr Balogh.

As such, it is also an “important channel for foreign direct investment,” he said. Foreign buyers have so far directly contributed between EUR 500m and EUR 1bn in FDI through BAMC, but indirectly their contribution is far bigger.

Mr Balogh mentioned the case of automotive supplier Cimos, which was acquired for roughly EUR 100,000, but then the new owners supplied it with over EUR 30m in fresh capital.

Mr Gregor Benčina, President of Slovenijales Group, Slovenia’s largest biggest group involved in the in manufacture and trading of wood products, noted that there were still significant investment opportunities in Slovenia.

Enumerating the main benefits of Slovenia as an investment destination – his company has carried out 16 or 17 greenfield investments and M&As since the early 2000s – he highlighted flexibility.

“We have what it takes to survive – a very strong ability to adapt,” he said, while also mentioning skilled workers, Slovenia’s suitability as a trial market and a place ideal for boutique manufacturing, reliability and quality.

He also said that after a period of acquisitions by funds, strategic partners were now coming in greater numbers focusing on manufacturing. He sees logistics, tourism and banking as the next areas of investment, but also private companies that are 20-40 years old and whose owners do not have successors.

In that sense Slovenia is very similar in structure to the German economy. “This shows our economy is maturing; despite all the sideways we are well on track,” according to Mr Benčina.

Mr Michael Hummelbrunner, Global Director Finance/Controlling at Magna Steyr, Austria, mentioned some of the same features when he explained why Magna Steyr decided to build a paint shop in Slovenia.

Good location and proximity to the corporate headquarters in Graz, a business-friendly environment, political and economic stability, and skilled labour were why Maribor-Hoče was picked as the site after what he described as “a very intense site selection.”

Mr Lance Liu, Managing Director of Pingan Ventures, one of the largest companies in China, presented his firm and outlined the history of Chinese ventures abroad.

He said the current wave of acquisitions – China’s Hisense recently acquired Slovenian home appliances maker Gorenje, for example – was different than the first wave in 2006-2007.

Back then Chinse investments in the West focused on finance and real estate, which then collapsed during the crisis, earning Chinese investors poor returns. Now the focus is on “real business” – manufacturing and consumer products.

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