Romania’s Property Fund close to secondary listing in London

By bne IntelliNews November 20, 2014

Iulian Ernst in Bucharest -

 

The secondary listing of shares of Romanian restitution fund Fondul Proprietatea on the London Stock Exchange could take place in the first half of December, after the Romanian financial market regulator endorses the necessary documents, Greg Konieczny, executive vice president of Templeton Emerging Markets Group, was quoted by local daily Bursa as saying on November 20.

The €2.6bn fund is already listed in Bucharest and its largest shareholder is Elliott Associates, which owns 19% according to Templeton, which manages Fondul Proprietatea.

The secondary listing will be carried out through depositary receipts, but this requires minor adjustments to national regulations in Romania, Fondul Proprietatea explained in late September. The fund has prepared all the necessary documents for listing, Konieczny assured.

The listing in London is mainly aimed at narrowing the discount at which the fund’s shares trade to the net value of its assets, Templeton executive chairman Mark Mobius explained. The fund’s shares trade at a 22% discount versus the net value of its assets, compared with only a 7-8% discount for Templeton Investment Trust, he specified. The fund’s shareholders asked Templeton to reduce the discount below 15% for two-thirds of the days measured for the period of October 1, 2014 to June 30, 2015.

Speaking of the listing of major companies in the fund’s portfolio, Konieczny mentioned that Hidroelectrica is expected to exit insolvency in 2015 and its IPO might take place in the first half of 2016. The IPO for the coal-fired power plant CE Oltenia is officially scheduled for November 2015. The company should however restructure and appoint a new managing board, he added. Other companies that should be listed in Konieczny’s view are Constanta Port, Bucharest airport and Salrom – the only local salt producer.

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