Slovenia has been a popular destination among British tourists for years. It is safe, offers unspoilt, beautiful nature and high quality of life. Unsurprisingly, some of the British visitors decided to buy property – in fact, at one-time British citizens were the number one foreign buyers of real estate in Slovenia. Slovenia, however, remains an unexplored opportunity for the British investors. The British owned companies that do operate in Slovenia operate well and stand out from the average: in fact, many of them are true success stories.
Take GKN Driveline Slovenia, a part of British GKN global engineering business group. The British company took over the driveline part of Zreče based toolmaker Unior in 1998. The company produces homokinetic joints for Mercedes and Volvo cars. Last year the company started an expansion program to be able to also supply Ford, Jaguar and Land Rover cars: the overall investment in the new capabilities will reach 20 million euros in three years and the company will create 100 new jobs. GKN Driveline Slovenia made 79 million euros of sales in 2016 – a 16 percent up from 2015's 68 million. Sales are expected to exceed 100 million next year. GKN Driveline now ranks as the 103rd largest Slovenian company. The new investment should push the company firmly into the top 100.
GKN Driveline remains one of the few investments made by large British companies in Slovenia. Of course, major companies like GlaxoSmithKline also have their subsidiaries in the alpine republic. The leading global packaging company acquired Austrian company Duropack – and with it Duropack-Tespack from Brestanica and Valkarton Logatec: the new company is called DS Smith Slovenija, its revenues exceeded 45 million euros last year. Some of the traditional industrial companies in Slovenia were bought by the British as well. An example is Ljubljana’s tobacco factory Tobačna Ljubljana: one of the oldest Slovenian factories owned by Imperial Brands PLC.
Another example of a successful British investment in Slovenia is this year’s best FDI Award winner Titus from Dekani. In 2005 Titus International took over Lama Dekani, a producer of connectors and damping hardware for the furniture industry. Titus Dekani is now the main R&D and production center for a group with 14 companies in Europe, USA and Asia. Titus Dekani’s sales reached close to 75 million euros in 2016: the company managed to almost quadruple its revenues in ten years.
Ascent Resources pls is “an independent oil and gas exploration and production company, headquartered in London”. The company’s main project is the exploration of gas in Petišovci in Prekmurje, northeastern corner of Slovenia. The British company is the majority partner in a joint venture with Slovenian energy trader Petrol. Over 43 million euros have been invested in the project so far. In November, the untreated gas started to flow from Petišovci field to Croatia for 300,000 euros per month. The revenues should help the partners to develop up to 15 wells. The company also plans to build a processing plant which would enable gas to be put into the Slovenian grid – the building of this plant is expected to take around 12 months. The total potential size of the gas field is estimated at 12 billion cubic meters: as Ascent’s CEO explained at London’s South-East Investor Event: “with patience, the prospects in the region are excellent”.
A few more examples: the engineering company Renishaw has invested in RLS, a Slovenian developer of sophisticated motion sensors. The company has evolved into one of the fastest growing companies in Slovenia, winning the 2015 Golden Gazelle award. Two years ago, Qubix, a British IT company specialized in Oracle business analytics solutions, acquired Slovenian company Bron with a plan to service the EMEA Region from England, Slovenia, and Dubai.
The UK’s largest integrated forestry company BSW is exploring options to build two sawmills in Slovenia with total capacity of 300,000 cubic meters per annum. There’s hardly any forest left on the British Isles, while Slovenia is one of the three most wooded countries in Europe - yet lacking large sawmills.
Overall, some 300 million euros of direct investments have come to Slovenia from British investors. This puts UK in 8th place among investing countries, while its share of total foreign investments remains low at 2.6 percent. Trade with the UK accounts for an even smaller share in the total of Slovenian exports and imports. The value of exports to Britain hovers at around half a billion euros, which represents 2.1 percent of total Slovenian exports. Last year, Slovenia imported goods and services from Britain in a total value of 367 million euros, a meager 1.5 percent of its imports. In fact, Slovenia imports less from the UK than from much smaller countries like Slovakia or Belgium, or even Turkey. Foreign Secretary Boris Johnson stressed during his visit to Slovenia early this year: "I have one message for you tonight, which is we in the UK want to intensify our partnership with you". As there’s room for improvement in business relations between the two friendly nations, we can hope that his words will lead to some tangible results.