The shares put up for sale by Transelectrica were oversubscribed by about 5.6 times, according to preliminary data available after the closing of the offer. Investors put orders on the market for about 195 million euros (700 million RON) in shares. The value of the offer is about 34.2 million euros (123.14 million RON).
Under the circumstances, the Transelectrica offer is the best of the last few years by far. It clearly exceeds last year's offering of IT&C retailer Flamingo International, which was oversubscribed by 3.2 times and that of Broker securities firm (2004), oversubscribed by about 3 times.
"According to the latest information available after the conclusion of the offer, the portion allocated to big investors had been oversubscribed by 7 or 8 times and oversubscription for the portion allocated to small investors was of 3 to 3.5," stated Razvan Purdila, head of the Capital Market department of Transelectrica.
Transelectrica put up for sale about 7.33 million shares at 16.8 RON/share. Sixty percent were offered for subscription to big investors, which clamoured to buy shares worth over 500,000 RON (140,000 euros), while the remaining 40% were offered to small investors.
Romanian investors displayed a keen interest in Transelectrica's offer, with the most important of those to have subscribed being the five SIFs, which bought significant stakes.
The biggest investor, however, was BCR, which subscribed 35 million euros' worth of shares, according to the information provided by Purdila. The foreign investors to have subscribed include investment fund Broadhurst, and funds belonging to Alpha Bank and Raiffeisen Bank, which brokered the offering along with BRD.
There were about 4,000 small investors, which subscribed shares worth 42 million euros. The number of investors is about one third of the active investors on the Bucharest Stock Exchange. Under the circumstances, Transelectrica will go directly to the first tier of the market.
"The response among Romanian investors was much better than expected while the participation of the foreign investors was a little less than originally thought, because of an unfavourable international context. What's most encouraging is the participation of the small investors that exceeded every expectation," Purdila specified.
It may also be that many investors, especially the larger ones, increased their subscription level over the last few days in order to get the number of shares they had initially set out to attain, considering the shares will be allocated on a pro-rata basis. For instance, in case of a 5-fold oversubscription, an investor that subscribed 10,000 shares will get 2,000.
"A high oversubscription level was expected, considering Transelectrica is the first major state-owned company to be floated," Octavian Molnar, deputy general manager of Arad-based IFB Finwest brokerage stated.
He forecasts a rebound of the Stock Exchange next week, given that some of the money oversubscribed for Transelectrica will return to the market.
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