Rumours check out: by the end of the month, Florin Georgescu, still a PSD (Social Democrat Party) deputy, and also the party's deputy leader and chairman of the Budget-Finance Committee within the Chamber of Deputies will become chairman of the Supervision Board of Banca Comerciala Romana (Romanian Commercial Bank - BCR), set to replace the current Board of Directors. Georgescu is to resign from all his political positions first, sources close to the talks over the sale of 25% plus two shares in BCR to EBRD and IFC told Ziarul Financiar.
Subsequently, the main requirement the two international financial institutions have for conducting the pre-privatisation transaction for BCR, the separation of the executive management from the administrative management is to be met. When contacted by Ziarul Financiar, Florin Georgescu said no comment, adding he did not want to talk about this.
Ruling party sources say he has indeed been proposed to be the future chairman of BCR's Supervision Board.
Nicolae Danila, who now has both executive and administrative duties, can sigh in relief. He will remain executive chairman of the bank. The quoted sources say EBRD and IFC will not appoint representatives to the executive management of BCR, this way showing their trust in Danila.
The new Supervision Board will comprise seven members, with EBRD and IFC set to appoint one representative to it each, two SIF representatives and three representatives of the Romanian State.
Florin Georgescu has been a member in BCR's Board of Directors for three years now, which, sources say, is good reason to choose him for chairman of the Supervision Board.
In his statement of interest filed in mid June 2003, Georgescu pledged to opt for either his deputy position or for the seat in BCR's Board of Directors within the time frame set by the law.
Florin Georgescu is also a member of the Romanian American Enterprise Fund's Board of Directors.
Georgescu's appointment to the Supervision Board does not mean that all the details concerning the transaction with EBRD and IFC have been worked out, as this could take up to two more months.
EBRD and IFC have been extremely concerned with negotiating the terms of the transactions so that they could provide for a gain when they sell their stake in BCR to either the much sought for strategic investor, or back to the Romanian State.
At the same time, the two institutions have conducted in-depth due diligence operations, in order to avoid unpleasant surprises and have come to know the exact situation of the bank and of the other entities in the BCR Group that make restructuring more complicated, as well as possible.
The delay in completing the talks with the two financial institutions implicitly meant postponing the payment of the $222 million, the negotiated price of the 25% plus two shares in BCR.
The Privatisation Authority last week announced the completion of the negotiations with EBRD and IFC on the conclusion of the deal. The latest two documents signed were the Shareholders' Agreement and the Sale Option Contract.
Although the negotiations over the deal with EBRD and IFC had become stuck in the last few weeks, APAPS started to discuss the sale of a second stake of up to 8% to BCR's Employees Association in the meantime. The employees may not buy BCR shares for less than 10,000 ROL apiece, which is equal to the par value per share.
razvan.voican@zf.ro
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