The merger between the Bucharest Stock Exchange (BSE) and RASDAQ, an essential project for making the capital market in Romania more alluring is starting to proceed by a Caragiale (famous Romanian author, best known for his comedies)-like scenario. Commenced in an enthusiastic frame of mind, also with a view to the European Union, the project is about to reach a stumbling block for purely Balkan reasons: vanity and pursuit of high-ranking positions.
Instead of having talks on how to address technical and legal issues (rather numerous actually) prevail, the most important issue of the merger process is now the rivalry between Sergiu Oprescu, Bucharest Stock Exchange chairman and Cristian Siminel Andrei, RASDAQ's chairman.
The rivalry, kept under wraps in the last few years, has become more and more visible last week and peaked with the proposition to drop the merger in favour of a RASDAQ takeover (possibly hostile) by the BSE made on Friday.
The proposition came from the BSE Board headed by Sergiu Oprescu and is an answer to Cristian Siminel Andrei's attempt to have the current BSE management replaced by a joint BSE-RASDAQ Board, to speed up the merger process.
Andrei's attempt to have the BSE management replaced occurred a week ago during Bucharest Stock Exchange's General Meeting and fell through for lack of quorum required for adopting such a decision.
Sergiu Oprescu was quick to react, starting to lobby among brokers in favour of RASDAQ's takeover by the BSE.
The acquisition, albeit it could cost the Stock Exchange several million dollars, as certain sources said, would rid BSE of Andrei's pressures and diminish his chances of becoming (in case he wants to) chairman of the Bucharest Stock Exchange created by the merger.
The BSE chairman position does not come with significant income, yet gives the holder high visibility and a great deal of influence.
Sergiu Oprescu is also the vice-president of Alpha Bank Romania and Siminel Andrei is the manager of the biggest investment fund in Romania, Broadhurst.
"The acquisition idea first came up three or four years ago but was dismissed for various reasons. The fact that the proposition was not presented and budgeted for in the Stock Exchange Meeting a week ago, although millions of dollars are at stake, casts a doubt on the thoroughness of the analysis. This year's budget includes technological investments, cutting the fee by some 30%, improving BSE's visibility in exchange for several hundred thousand euros, but not several million dollars for RASDAQ's acquisition. This is a tight game for a market that is growing thinner by the day," Cristian Siminel Andrei says.
When contacted by Ziarul Financiar for comment, Sergiu Oprescu said, "It is regrettable that the takeover proposal is regarded as a reply to Mr. Andrei's attempt to propose a new joint committee to head BSE and RASDAQ. We came up with the takeover proposal during the General Meeting of the Stock Exchange, two hours before he (Andrei) proposed the replacement of the Board, which would not have been legal, anyway. The final takeover decision is up to the brokers."
laurentiu.ispir@zf.ro
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