The newly-established Litex Motors will assemble vehicles from Chinese parts in Bulgaria, Corporate Commercial Bank's (CCB) marketing director Alexander Hristov told The Sofia Echo on May 13. CCB holds eight per cent in the joint company, while the remaining 92 per cent are in the hands of local businessman Grisha Ganchev.

Litex Motors plans to sell domestically and export the vehicles it assembles only to Greece and Romania for now, Hristov said. Bearing in mind that the new company was just founded, according to him it did not have the needed permits and licences to trade with other European countries.

On April 29, CCB managing board gave its approval to take a stake in the company, which was founded a day later. The bank will contribute 1.6 million leva to Litex Motors' equity, which will total 20 million leva. Each share has a nominal value of 1000 leva, the bank said.

"CCB finances different infrastructure and trade projects," Hristov said, when asked for the reason CCB decided to take part in a company that would design and produce cars and motor bikes of different size, as well as spare parts.

The vehicles that will be assembled in Bulgaria are Chinese, but Hristov could not name the Chinese company, or companies, with which the newly-established company will work. He said that Litex Motors was still negotiating with Chinese producers and a licence agreement would be signed in the near future.

Litex Motors would also import and export vehicles, spare parts and accessories, fuels and oils. The new company will also carry out service and repair activities, as well as tuning, transport and forwarding, the bank said. The company has no plans to start assembling or the import/export of freight and cargo vehicles, Hristov said.

However, he could not comment on where Litex Motors' seat would be or any details regarding its management. Contacted by The Sofia Echo, Litex Commerce director Iliya Terziev said only that the new company's seat will be in Sofia, but would not comment on other issues, including which company owned by Ganchev would hold the majority stake of 92 per cent in Litex Motors. Terziev said that the media reports that this was Litex Commerce were not correct, adding that the investor had an agreement with Bulgarian-language daily Trud concerning the dissemination of information. He then hung up.

Owned by Ganchev, Litex Commerce is a diversified holdings company, with business interests in the energy, food industry, transport, tourism, finance and real estate sectors, claiming assets worth 220 million euro in 2007, according to the information posted on its website.

Should Litex Motors secure an assembly licence, it would become the only car maker in Bulgaria, with similar initiatives in the past coming to nought. The country is used as a base of operations by several companies that make car parts, including French Montupet (aluminium components), Belgium-based Melexis (electronics) and Johnson Controls (interior systems).