The state-owned military factory Terem will be “restructured”

Defense Minister Dimitar Stoyanov has ordered the management of Terem – Holding EAD to draw up a restructuring plan by August 10. The state-owned company, which specializes in repairing armored vehicles and other equipment used by the Bulgarian Army, is in dire financial straits. According to the minister, since the beginning of the year workers in Targovishte have received only two paychecks – in January and June – with the funds secured through loans.

During Friday’s parliamentary oversight session Dimitar Stoyanov explained that on a regional scale orders for Soviet-style armored and other wheeled vehicles have decreased significantly in recent years.

The number of such vehicles in service with the Bulgarian Army is also declining. This has led to a reduction in the plant’s workload and a lack of regular orders from both the ministry and external contractors,” Stoyanov noted.

According to him the plan should define specific measures to be taken as soon as possible “to develop and strengthen the company, optimize its production facilities and business processes by freeing up real estate, selling unnecessary tangible assets and utilizing materials and inventory to modernize the machinery fleet, upgrade the existing infrastructure and reduce costs.”

The Ministry of Defense has referred the matter to the Agency for Public Enterprises and Control regarding the possibility of changing the company’s classification from Group A1 to Group A2, which would allow the company to be entrusted with public functions with additional funding.

I have held a series of meetings with potential contractors regarding the possible conclusion of contracts under the SAFE mechanism to relocate part of the production to Bulgaria under this mechanism. I have arranged for foreign companies to visit Terem – Khan Krum (a subsidiary of Terem – Holding) and I am awaiting their feedback,” the minister added.

Another initiative of the Ministry, according to Stoyanov, is to conduct “active” discussions with commercial companies to conclude contracts with Terem – Khan Krum for the repair of equipment “with the aim of preserving the company’s capabilities and capacity and seeking opportunities to adopt modern NATO standards.”

The Terem – Khan Krum EOOD plant in Targovishte is an essential facility for the Ministry of Defense, as it is the only enterprise in Bulgaria that possesses the technological capacity, technical documentation, qualified personnel and established capabilities to perform major repairs and refurbishment of T-72 and T-55 tanks, the minister emphasized.

The company is part of the defense and mobilization preparedness system and is of vital importance to the country’s defense in both peacetime and wartime; therefore the company is of strategic importance to both the country and the ministry,” he added.

Translated with DeepL.