An extraordinary shareholders’ assembly of the state-owned hotel and tourism group Budvanska Rivijera has been scheduled for October 24, according to the Montenegro Stock Exchange. The meeting will focus on dismissing the current board of directors and electing a new one.
Former board president Mijomir Pejović (Democrats) resigned in August. Under Montenegro’s Company Law, if one board member resigns, the entire board’s mandate automatically expires. The board consists of five members—three appointed by the government upon the proposal of the Ministry of Tourism, and two representing the largest minority shareholder, MK Group.
Pejović resigned after opposing the appointment of Luka Vukalović (Europe Now Movement, PES) as board president. He publicly disagreed with plans to privatize Budvanska Rivijera, which reportedly prompted his resignation. For the past five years, the Democrats controlled the company’s board, but the appointment of Vukalović marked a shift in management toward PES, coinciding with MK Group’s proposed restructuring of the company.
The ownership structure of Budvanska Rivijera is as follows: the Government of Montenegro holds 41.64%, MKG Properties 26.18%, the Pension and Disability Insurance Fund 12.82%, Tandexon Limited 7.4%, and the Employment Agency 4.27%. Other shareholders collectively own less than 1%.
In its proposal to the government, MK Group suggested two restructuring models for Budvanska Rivijera. The first involves a joint investment between the state (as the majority shareholder) and minority shareholders, including MK Group, to jointly develop new projects. The second, and reportedly more likely option, proposes a share swap and the creation of two separate companies.
Under this second model, one company—without MK Group’s participation—would retain ownership of the hotels Palas, Castellastva, Kristal Palas, and Mogren, remaining under state control. The other company, where MK Group would hold a majority stake and the state a minority one, would manage the Slovenska Plaža resort and Hotel Aleksandar.
The Montenegrin government has hired an expert consultant to evaluate and analyze both proposed restructuring models for Budvanska Rivijera.
