Romanian power distributor Electrica's 51% IPO starts on June 10 - sources

By bne IntelliNews May 23, 2014

Romania’s government has reportedly decided to start the IPO for 51% in power distribution group Electrica on June 10, expecting EUR 390mn to be cashed by the company from the new shares issue, Ziarul Financiar daily announced quoting apparently leaked data. The government also allegedly wants to guarantee a certain amount of shares [worth EUR 3,600 approx.] will be available for small individual investors.

Earlier this month, the government said that the decision on Electrica’s IPO would be endorsed by the end of May and will start 3-4 days afterwards. GDRs will most likely be on sale in London parallel with the shares issued on the local market.

Electrica is formed essentially by 100% in three of the country’s regional power distribution firms. It reported RON 5.5bn [EUR 1.23bn] in revenues and a RON 452mn [EUR 101mn] net profit in 2012.

The EUR 390mn expected by the government from the 51% stake means that the company’s shares would be valued at 7 times its net profit – well within the 5-7 PER seen for similar companies in the region, the daily commented.

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