Arco Vara Exits Bulgaria in EUR 6.3M Botanica Lozen Buyout

Arco Vara AS said on 29 September 2026 that it entered a preliminary agreement to sell its 75% stake in Bulgarian property developer Botanica Lozen EOOD to Kamaleo Invest OOD for EUR 6.3 million. Kamaleo Invest already holds the remaining 25% and is represented by Christian Petrov, general manager of Botanica Lozen since 27 October 2025, making the deal a management buyout. Completion is due by 26 February 2027, and Arco Vara said it will exit Bulgarian real estate development entirely.

Context — why the Bulgarian exit matters now

Arco Vara has been a shareholder in the Botanica Lozen project since 2018, when it acquired the predecessor company Arco Lozen EOOD outright for EUR 2.939 million. The company said the original purchase was not treated as a business combination because the target had no active operations — essentially a land purchase with development potential.

The deal now unwinds that position with a buyer already inside the company. Kamaleo Invest bought its 25% in May 2026, and the same month the project's balance sheet was reshaped by the conversion of roughly EUR 5.7 million of loan liabilities into equity. Arco Vara said those changes materially altered Botanica Lozen's financial position after the 2025 financial year closed.

The exit sits alongside a broader clean-up. Arco Vara will also dispose of five dormant Bulgarian entities — Arco Riverside EOOD, Arco Manastirski EOOD, Arco Vara Bulgaria EOOD, Arco Invest EOOD and Iztok Parkside EOOD. The company said these carry no material weight on group assets, results or cash flow.

Capital released by the sale is earmarked for Arco Vara's Estonian projects, which the company named as the Luther Quarter and Arcojärve developments. The framing is a reallocation of capital toward the home market rather than a distressed disposal.

Data — what the numbers show

The purchase price breaks into three payments. The buyer pays EUR 1.27 million as a non-refundable deposit within seven business days of signing, EUR 1.00 million by 31 October 2026, and EUR 4.03 million on completion. Arco Vara said the first two payments will be funded by a loan from Botanica Lozen EOOD to the buyer.

Item	Figure
Price for 75% stake	EUR 6.3 million
Deposit (7 business days)	EUR 1.27 million
Second payment (31 Oct 2026)	EUR 1.00 million
Payment on completion	EUR 4.03 million
Completion deadline	26 Feb 2027

The company put Botanica Lozen's equity at approximately EUR 8.7 million, after the May 2026 equity conversion and the 25% stake sale. Against the pre-conversion figure of EUR 654 thousand reported for 2025, that is a step change in the capital structure rather than an operating gain.

Botanica Lozen reported no revenue in 2023, 2024 or 2025. Net results moved from a EUR 432 thousand loss in 2023 to a EUR 177 thousand profit in 2024 and a EUR 612 thousand loss in 2025. Total assets rose from EUR 12.121 million to EUR 13.629 million across 2024-2025, while total liabilities climbed from EUR 10.817 million to EUR 12.935 million.

Loan liabilities stood at EUR 139.5 thousand as of 28 September 2026, all owed to Arco Vara group companies. Arco Vara said that balance will be zero at closing.

Analysis — what it means for markets and sectors

The most striking line is the profit guidance: Arco Vara said the EUR 6.3 million price is close to the equity value attributable to its stake, so it does not expect a material profit impact. For a holding sold at roughly book, the transaction is a balance-sheet simplification, not a value crystallisation event.

Second-order effects run through consolidation. On completion, Arco Vara stops consolidating Botanica Lozen, so group assets and liabilities fall by the subsidiary's respective balances, net of consideration received. With Botanica Lozen carrying EUR 12.935 million of liabilities at end-2025 against EUR 654 thousand of equity, the group's reported leverage ratios should improve mechanically without any change in underlying Estonian operations.

The structure carries genuine risk for Arco Vara. The first two payments, totalling EUR 2.27 million, are financed by a loan from the target company itself — meaning the seller funds part of its own sale proceeds. If completion slips past 26 February 2027, Arco Vara has disclosed only that the deposit is non-refundable; it did not disclose default remedies on the later instalments.

The related-party dimension matters for governance readers. Kamaleo Invest owns 25% of the subsidiary being sold, making this a related-party transaction, though Arco Vara said it does not meet the materiality threshold in clause 7.9.4 of the Nasdaq Tallinn rules. The disposal itself does qualify as a material disposal of a holding under clause 7.12. Arco Vara said its management and supervisory board members hold no personal interest.

Positioning is straightforward. This is a small-cap Nordic/Baltic property name reducing geographic complexity; the flow is out of Bulgarian development exposure and into Estonian residential pipelines. No index-level read-through exists at this size.

Outlook — what to watch next

Three dated checkpoints frame the story. The EUR 1.27 million deposit falls due within seven business days of signing. The EUR 1.00 million instalment lands by 31 October 2026. Final completion, and the EUR 4.03 million balance, is due by 26 February 2027.

Arco Vara said it will inform the market separately when the transaction completes, so the next hard disclosure is the completion notice itself. Between now and then, readers can track whether the Estonian capital redeployment into the Luther Quarter and Arcojärve projects produces any separate announcements.

The Arco Vara trademark will remain in use in Bulgaria under a licence agreement with a local real estate agency outside the consolidation group, so brand continuity survives the ownership change. No court or arbitration proceedings are pending against Botanica Lozen that could materially affect its business.

Frequently Asked Questions

What does the Arco Vara Botanica Lozen sale mean for retail investors?

For shareholders, the headline is neutral. Arco Vara said the EUR 6.3 million price is close to the equity value of its 75% stake, so no material profit is expected. The real effect is structural: the group stops consolidating a Bulgarian subsidiary with EUR 12.935 million of liabilities, and capital moves toward Estonian developments. This is a simplification trade, not an earnings event.

Why is Kamaleo Invest buying the remaining 75% of Botanica Lozen?

Kamaleo Invest already owned 25% and is represented by Christian Petrov, who has run Botanica Lozen as general manager since 27 October 2025. The purchase consolidates full ownership under existing management. Notably, the first two payments are financed by a loan from Botanica Lozen itself, meaning the target company is funding part of the buyer's consideration rather than an external lender.

What happens to Arco Vara's Bulgarian operations after the sale?

Arco Vara said that after completion it will have no subsidiaries engaged in real estate development in Bulgaria, ending its direct business and financial risk tied to Bulgarian development. Five dormant entities from earlier projects are also being disposed of. The Arco Vara brand continues in Bulgaria only through a licence agreement with a local agency outside the group.

Bottom Line

Arco Vara sells its Bulgarian development arm at roughly book value, trading geographic complexity for Estonian project capital.

Disclaimer: This article is for informational purposes only and does not constitute investment advice. CFD trading carries high risk of capital loss.