Boyana Cinema Center is not just a plot of land on the outskirts of Sofia. It is a symbol of Bulgarian cinema, a place where for decades some of the most significant film productions in our country have been created and generations of Bulgarian artists have worked. Today, however, more and more question marks are piling up around the future of the emblematic studio. Is there a real danger that the film complex will be sold and its plot will become one of the most expensive construction sites in the capital? Have all obligations under the privatization contract been fulfilled and has the state done what is necessary to protect the public interest before the expiration of the key restrictions in November? According to these questions FACTI spoke with the MP from “Vazrazhdane“ Dimo Drenchev.
- Mr. Drenchev, why do you think that Kinocentr “Boyana“ could be liquidated and turned into a construction site. What specific data do you have that such a scenario is actually being prepared?
- As early as November 2024, information appeared that the executive director of “New Boyana Film“ AD Yariv Lerner had convened a general meeting with the studio's employees, at which he informed them that two of the three owners - Avi Lerner and Trevor Short, who represent the majority in the company, had decided to proceed with the sale of the studio. The holding of this meeting was confirmed to us by former employees of the company, and so far there has been no publicly known refutation of this information.
We have received information from representatives of foreign investors that in 2025 they were notified of the upcoming sale of “New Boyana Film“ and that a buyer was being sought. In addition, in telephone conversations held personally with Avi Lerner and Trevor Short, the two confirmed their intention to sell the studio.
A number of facts related to the activities of the parent company New Image/Millennium, which acquired the “Boyana“ cinema center, are also publicly known.
The company vacated its Los Angeles office, a number of key employees left,
its film library was sold - one of the most valuable assets of any production company, and publicly available information indicates that Avi Lerner also sold his property in Los Angeles. All these actions outline a consistent process of getting rid of major assets, and at the moment the “Boyana“ cinema center remains the most significant asset of the group.
According to our information, in 2025, talks were held with representatives of the American York Studios regarding the possible acquisition of “New Boyana Film“. A deal was not reached, and according to sources familiar with the negotiations, the main reason was the significant discrepancy in the company's valuation.
We also have information about interest shown by Bulgarian investors in the construction sector, as well as preparatory actions related to potential future development of the terrain. Information has also been received about possible procedures for amending the detailed development plan (DDP). These are circumstances that can be officially verified by the competent institutions.
According to our data, the market value of the business as an operating film studio is in the range of 45-50 million euros. At the same time, we have information that the owners were looking for a price of approximately 180 million euros, arguing with the value of the land.
If these data are compared, the logical conclusion is that the interest in the property could hardly be explained solely by the film business. It is unlikely that a Bulgarian investor would pay such a sum to develop an international film studio, since such an activity requires established international partnerships, experience and positions on the world market.
It is equally unlikely that a strategic investor from the film industry would pay a price significantly exceeding the market value of the business, especially given that in recent years Bulgaria has been losing competitive positions as a destination for international productions to countries such as Greece and Hungary.
Therefore, all currently available data indicate that if a deal were to be concluded at such price levels, the leading economic interest would be related primarily to the value and future development of the land, and not to the development of film production. What the specific purpose of the land will be after a possible deal can only be established on the basis of official investment intentions and administrative acts.
- You claim that key restrictions on the privatization contract expire in November. What exactly changes after this date and why do you define it as critical for the future of the cinema center?
- The “Boyana“ Cinema Center is the emblem of Bulgarian cinema. The privatization contract is not limited to the payment of the purchase price. It contains a complex of obligations of the privatizer to the Bulgarian state, including commitments that directly affect the development of the Bulgarian film industry and the preservation of the “Boyana“ Cinema Center as a strategic cultural and production asset.
In summary, the main obligations include:
1. Payment of the agreed purchase price.
2. Restrictions on the transfer of shares:
– for a period of 10 years, the shares shall not be transferred outside the cases expressly provided for in the contract and without the necessary permits from the Post-Privatization Control Agency;
– in the event of an admissible transfer, the acquirer shall assume the relevant contractual obligations and all notification and control requirements shall be met.
3. Prohibition of liquidation and bankruptcy:
– for a period of 10 years, liquidation or declaration of bankruptcy of the company shall not be allowed.
4. Preservation of the subject of activity:
– for a period of 10 years, the subject of activity shall not be changed in a manner that leads to the termination of the activity related to the film industry;
– no less than 80% of the company's revenues shall be generated from this activity.
5. Restrictions on the disposal of real estate:
– for a period of 20 years, no disposal of real estate or parts thereof shall be carried out without prior written permission;
– no real rights and encumbrances shall be established outside the cases expressly permitted under the contract.
6. Implementation of an investment program:
– investments shall be made in accordance with the approved investment plan;
– their total amount shall be no less than 15.6 million euros, distributed by year in accordance with the annex to the contract.
7. Obligations regarding the film archive:
– the archive shall be preserved and stored;
– premises for its storage shall be provided free of charge;
– to ensure access to the Bulgarian National Film Library;
– if necessary, the relocation of the archive shall be organized and financed in accordance with the terms of the contract.
8. Prohibition of actions through which third parties or state bodies may acquire rights to properties and assets protected by the contract.
9. Implementation of the proposed and approved development strategy of the company.
10. Reporting and control:
– annual provision of information and reports to the competent state body;
– allowing inspections and providing documents certifying the fulfillment of contractual obligations.
11. Participation in the production of Bulgarian feature and animated films in the volume and terms specified in the contract.
- When does the 20-year limitation period on the disposal of real estate expire?
- According to our information, the 20-year limitation period on the disposal of real estate expires on November 17, 2026. After this date, provided that all contractual obligations have been duly fulfilled and there are no other legal or contractual restrictions, the owner could dispose of the company's properties and assets, including the land.
That is why the main question is not only what the owner intends to do after November 17, 2026. The main question is whether the privatizer has fully and duly fulfilled all its obligations, on the basis of which it would acquire one of the most significant assets of the Bulgarian film industry.
It is essential and the question of what economic choice would be made in the event of a possible sale.
If a price of around 50 million euros is offered for the operating film studio, and a price of around 180 million euros for the land, there is an obvious risk that the economic interest will be directed not towards the development of film production, but towards the realization of the value of the real estate through its development.
Has the owner fulfilled all investment, production and other commitments set out in the privatization of “Boyana Film“, or are there grounds for the state to take action to protect the public interest? This is the key question.
The competent state body that should control the implementation of the privatization contract is the Agency for Public Enterprises and Control as the legal successor of the Agency for Post-Privatization Control. However, to date, a sufficiently detailed and publicly accessible report has not been presented, from which the public can determine whether each of the obligations under the contract has been fulfilled, to what extent it has been fulfilled and with what documents this fulfillment has been certified.
It is not enough to generally state that the contract has been fulfilled. A specific answer needs to be given for each individual obligation.
For example, what exactly does the proposed and approved development strategy for the company, which is part of the privatization contract, contain? What specific goals were set in it? Have these goals been met and by what objective indicators was their implementation assessed?
It is logical to assume that the state privatized this asset not only to receive the sale price, but also with the expectation that the private investor would develop the studio, improve the environment for film production, attract international productions and create sustainable benefits for the Bulgarian film community and economy.
Whether this actually happened must be established through a comprehensive, thorough and public investigation. This is especially necessary given the size of the privatization price and the long-term commitments to which it was tied.
The “Boyana“ Cinema Center is not an ordinary piece of real estate.
It is an enterprise of key importance for the Bulgarian film industry, for the professional realization of thousands of specialists and for Bulgaria's ability to attract foreign investment in film production. Therefore, it is not without significance whether, after a possible sale, the cinema center will continue to function as a film studio and will be developed as a strategic infrastructure for the industry, or its main value will be realized through development of the land. The second scenario would mean not just a change in the ownership of a private property, but a potential loss of an asset of national importance, without a guarantee of comparable economic, cultural or social added value.
Before the restrictions on the disposal of the properties expire, the state should establish and publicly announce whether the privatization contract has been fully, properly and in accordance with the initial commitments. This is a minimum requirement for transparency and protection of the public interest.
- Why do you insist on the Ministry of Culture intervening? What specific legal mechanisms does the state have to prevent a possible sale of the land?
- When concluding the privatization contract, the state retained 5% of the company's capital. It is logical to assume that this participation was not formal, but was intended to provide an opportunity for institutional control and to protect the public interest, including the interests of the Bulgarian film industry.
The Ministry of Culture was designated as the body exercising the rights of the state. In this capacity, the ministry was to appoint a representative to the board of directors to monitor the activities of the company and protect the state and public interest.
However, in 2016, the company's capital was increased through a non-cash contribution related to the assignment of receivables, as a result of which the state participation was reduced from 5% to approximately 0.06%. In practice, this has reduced the state's share to a negligible level and has limited its ability to exercise real influence over the management and strategic decisions of the company.
This circumstance should be examined in detail.
It is necessary to establish under what conditions the capital increase was carried out, how the value of the contributed receivables was determined, what position the Ministry of Culture took and whether the state representative took any action to protect the state participation.
It should also be clarified whether this operation did not in fact render meaningless one of the guarantees that the state retained during the privatization. If the state participation was intended as a control mechanism, its reduction to 0.06% raises the reasonable question of whether this mechanism was not practically neutralized.
This operation, as well as all other actions of the privatizer in connection with the implementation of the privatization contract, must be subjected to a comprehensive and independent review. The verification should not be limited to a formal establishment of whether reports have been submitted, but should provide a concrete answer as to whether all investment, production, management and property obligations have been fulfilled in full and in accordance with the objectives of the contract.
In the event of a breach of or circumvention of contractual obligations, the state should consider all legal options for protecting the public interest. This includes seeking contractual liability, imposing sanctions and, to the extent permitted by law and contract, introducing or extending restrictions on the disposal of real estate.
It is particularly important to consider the possibility of extending the period during which the land cannot be freely disposed of if it is established that the privatizer's counter-obligations have not been duly fulfilled.
It would not be acceptable for the restrictions to be lifted automatically without the state having first established whether it has received everything it is owed under the contract.
The verification should not be left solely to the Ministry of Culture or the Agency for Public Enterprises and Control. The transaction is simultaneously cultural, financial, economic and property in nature. Therefore, it is necessary to carry out a coordinated audit with the participation of the Ministry of Finance and the Ministry of Economy, as well as other competent control bodies.
Such an audit should cover at least the increase in capital, the reduction of the state share, the implementation of the investment program, the preservation of the subject of activity, the production commitments to the Bulgarian cinema, the management of real estate and the implementation of the approved development strategy. Before the expiration of the restrictions on the disposal of the land, the state is obliged to give a clear and public answer as to whether the privatization contract has been fully implemented and whether the public interest has been effectively protected. Without such a check, the abolition of the restrictions would create a risk that an asset of national importance will be transformed or sold, without the public knowing whether the privatizer has fulfilled its counter-obligations.
To be continued…