IPOs at Romanian energy companies might still be carried out this year – daily

By bne IntelliNews August 7, 2013

Romania’s government still plans to organise 10% IPOs at Romanian nuclear company Nuclearelectrica and natural gas production and storage company Romgaz this autumn, Bursa daily reported, quoting government officials as claiming in its Aug 6 and Aug 7 issues.

Having the IPO at Romgaz completed so soon looks rather improbable though, since the gas reserves operated by the company have to be surveyed first.

At the same time, the country’s main news agency Mediafax, leading financial newspaper Ziarul Financiar and other foreign sources including Reuters have quoted a draft letter of intent prepared by the government for the IMF saying that the IPOs are postponed for the autumn of 2014.

The government has not issued any clarification in this regard yet. In the meanwhile, the Memorandum of Understanding for the policies to be pursued under Romania's follow-up SBA with the IMF, signed on July 29, was published by Hotnews. It includes autumn-2014 deadlines for the IPOs at the state controlled energy companies including Nuclearelectrica and Romgaz.

Separately, local stock brokers commented against the government’s planned dual listings and IPOs of the energy companies both on the local and foreign stock exchanges. The dual floating is reportedly recommended by the consultants hired by the government to handle the IPOs. Brokers quoted by Ziarul Financiar daily argue that having the IPOs conducted strictly in Romania and the shares listed only in Romania provides more benefits both to state and to the market.

An IMF expert team visited Romania in July to prepare the follow-up agreement. It concluded that such a follow-up agreement would be appropriate, but the final terms of the SBA have not been set yet. The Fund’s Board is supposed to discuss the new SBA in September.

Several LoI drafts leaked to media revealed measures that were meanwhile rejected by the government, such as the social security contributions of male employees for their unemployed spouses.

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