Homegrown Giants: Companies To Watch in Eastern Europe

While much is written about multinationals moving to Eastern Europe, less is known about home-grown companies that have made an international profile for themselves. A number of them have been able to weather the storm that blew in with the transition to a market economy and have become important global players. The following are thumbnail profiles of a few of them, Central and Eastern Europe's own economic success stories, who are poised to enjoy even stronger growth after any remaining barriers to EU markets fall on May 1.

Latvian Shipping Company - Latvia

Latvian Shipping Company (LSC) is the largest shipping company in Latvia and provides a range of sea transportation services. It has the fifth largest tanker fleet in the world and the largest in Northern Europe. The company began operations in 1991 after it took over 87 vessels from the Soviet commercial fleet which were registered in Latvian ports. LSC has some 1,800 employees around the globe and rang up nearly $194 million in shipping turnover last year.

Since the company's fleet is aging, its strategic plan for 2003-2010 provides for a €294 million ($350 million) investment in a fleet renewal program. To fulfill a commitment to the International Monetary Fund, the government had to sell its majority stake in the company. After several failed attempts, 51 percent of the company was successfully sold in 2002. Latvian investors purchased some 61 percent of the shares, while international investors bought the remaining 39 percent.

Gorenje Group - Slovenia

Household appliance maker Gorenje is Slovenia's largest manufacturing company and also Slovenia's largest net exporter. It manufactures about 2 million large household appliances annually, of which 93 percent are exported to demanding foreign markets. It controls 70 percent of the Slovenian market and has been branching out into Europe. The Gorenje Group, which includes the parent company and subsidiaries at home and abroad, recorded net sales revenues of €826 million ($985 million) in 2003

The company was founded in 1950, when the production of small stoves began in the small town of Gorenje. Its first export order came in 1961 from Germany. Ten years later, its first subsidiary was set up in Munich. It is now doing business in more than 60 countries.

Franjo Bobinac, Gorenje's chairman who took over in 2003, said he aims to place the company among the top five leading companies in Europe by 2006 and reaching €1 billion in sales in the next three to four years.

Zalakerámia Rt. - Hungary

Zalakerámia manufactures, distributes and sells glazed ceramic floor, wall and stove tiles and bathroom equipment. It also runs a clay and limestone mine. The company was founded in 1951, when it primarily made stove tiles. But with the decreasing demand for tiled stoves it shifted its focus on floor and wall tiles. In 1991, the Zalakerámia Incorporated Company was formed. It is the only company representing the Hungarian building industry whose stocks are traded on the Budapest Stock Exchange.

It has two plants in Hungary and two foreign subsidiaries: Cesarom in Romania and Inker in Croatia. The group produces 9 million square meters of tiles annually and has nearly 3,000 employees worldwide. Sales in 2003 were €76 million.