Foreign investors queuing up to meet Fondul Proprietatea

Fondul Proprietatea (Property Fund - FP) rush has taken over Romania this winter and the tens of millions of euros expected to enter Romania after its floatation on the Bucharest Stock Exchange are making many shareholders already dream of becoming millionaires.

As of January 25, when the floatation of Fondul Proprietatea on the Bucharest Stock Exchange will take place, foreign investors will have access to Romania's most valuable company, which has 3.5 billion euros in assets and stakes in the leading local energy companies.
To attract foreign investment funds, the broker consortium comprising Raiffeisen Capital & Investment, ING and BRD, put together the biggest road show ever for a Romanian issuer. The Fondul Proprietatea tour started in Bucharest and will continue in London, Paris, Frankfurt, Vienna, Helsinki, Tallinn, Budapest, Copehagen, Stockholm, Warsaw, Zurich and Amsterdam until February 1.
Those who are most early awaiting the foreign investment funds to arrive are the speculators, who became shareholders of the Fund because of political influence and not because they had had their properties seized by the communist regime.
On the other hand, over 50,000 former owners are expecting to receive their compensation from the authorities in charge of this, but the process will not resume any sooner than May, after the floatation of the Fund.
The Romanian state is going to offer Fondul Proprietatea shares as compensation to over 60,000 former owners depending on the price of stock on the BSE starting May, after in the past five years around 5,000 persons have received shares at the fixed value of 1 RON.
If the stock quote will stand below 1 RON, there are premises of discrimination between the old shareholders and the new ones, who are likely to receive a higher number of shares for the same value of compensations, lawyers maintain.
A stock price on the Bucharest Stock Exchange of below 1 RON is going to put pressure on the stake of 5.4 billion shares the state still holds in Fondul Proprietatea for the compensation of former owners. Thus, what for former owners will mean more shares, for the Romanian state will mean a rapid Fund dry-up.
"In two years at the latest, the state will exhaust Fondul Proprietatea, I expect the over 5.4 billion shares left to be enough for another 5,000 persons. The big problem is what is going to happen with the over 50,000 former owners waiting for years at ANRP. Will the Romanian state be willing to raise the Fund's capital or will it put a lid on compensations and schedule payments over long intervals?," lawyer Iulian Lepa wonders.