What Templeton does for 15m euros at Fondul Proprietatea
The first Fondul Proprietatea budget put together by its new manager, Franklin Templeton, is conservative compared with market expectations and with the around 15 million-euro per year fee that Templeton will collect for managing the 3.5 billion-euro assets.
Investors have hoped that the coming of UK-based Franklin
Templeton to the helm of Fondul Proprietatea will mean an end to
passive asset management and to assets being kept in a bank, and
that the Fund will start to invest on its own. The draft budget for
2011, as put together by Franklin Templeton, reveals, however, that
dividends and interest rates will continue to be the main source of
revenue.
"The budget is very conservative and, strictly as a piece of
information, it can be perceived negatively. However, one needs to
keep in mind that Templeton does not yet hold full control of the
Fund, and that the priority for a manager is to manage the
relationship with the state at Petrom, Romgaz and the two big
energy companies," says Ovidiu Fer, analyst with Czech brokerage
Wood&Co, a 2.7% shareholder in the Fund. For next year, the
Fund has budgeted a 207 million-RON net profit, 6% more than this
year's budget, and nearly 300 million RON in revenues, 8% more than
2010 estimates.
The draft budget will be voted on by shareholders during the
General Meeting of November 29th.