Germany's Kinowelt is continuing to build up its Eastern European presence by setting up two distribution outfits in Bulgaria, one in partnership with local theatrical distributor Duga Entertainment and the other with video company Solaris.

The German mini-major has taken a 51% stake in Kinowelt Bulgaria, a joint venture with Solaris which will handle local video and TV distribution of Kinowelt's slate. The new outfit has, in turn, taken a 71% stake in Kinowelt Duga, a joint venture with theatrical distributor Duga.

Kinowelt Duga will take over theatrical distribution of 20th Century Fox product in Bulgaria, which Duga has handled since 1992. It will also handle product supplied by Kinowelt including titles from New Line, Beacon Communications and Alliance Atlantis.

Kinowelt International general manager Alexander van Duelmen and Solaris chief Valeri Ignatov will head up Kinowelt Bulgaria, while Duga shareholder Anna Arsova and Ignatov will run Kinowelt Duga.

Van Duelmen said the Bulgarian operations represented an important step in Kinowelt's Eastern expansion, as the market is growing and likely to introduce anti-piracy laws, particularly if it achieves its aim of joining the European Union.

"A third private television licence was recently granted in Bulgaria, which means there will be continued competition, and as soon as multiplexes arrive, the theatrical market will also continue to grow," van Duelmen said.

Kinowelt has expanded aggressively into Eastern Europe this year through joint ventures and licensing deals in Poland, Russia, Hungary, the Baltic states, the Czech Republic, Slovakia, Slovenia and Croatia. In July it established the Russian distribution outfit Gemini Kinomir in partnership with Bodo Scriba's Moscow-based distributor Gemini International.

  • Kinowelt reported an 82% increase in turnover to $179m (DM411m) and a fourfold increase in pre-tax profits to $24.1m (DM55.3m) for the first nine months of the year. At the after tax level the group reported a loss of $1.4m (DM3.1m) for the summer quarter which is traditionally its quietest. That left net profits at $7.5m (DM17.2m) for the first nine months.