Fondul Proprietatea wants IPOs for Hidroelectrica and Nuclearelectrica

Proprietatea Fund has called for an Extraordinary General Shareholders Meeting at Hidroelectrica and Nuclearelectrica, respectively, in order to request the shareholders’ approval for the listing of the two companies on the Bucharest Stock Exchange (BVB). The meeting should take place within 60 days from the requests submitted by Fondul Proprietatea.

According to the latest memorandum of understanding with the International Monetary Fund, the Government through the Ministry of Economy, Commerce and Business Environment (MECMA) as the majority shareholder of Hidroelectrica and Nuclearelectrica, pledged to offer minority stakes in these two companies with a view towards generating sizable additional investment in the energy sector.

Fondul Proprietatea anticipates that the IPOs for the two state-owned energy companies will allow The Government, through MECMA to benefit from the increased value of the companies. In addition, the companies listed at BVB will have easier access to equity and debt financing needed to implement important investments for their businesses, such as the Tarnita project for Hidorelectrica or the two nuclear reactors for Nuclearelectrica.

“We strongly believe that Hidroelectrica and Nuclearelectrica are ready to come to the market and that this process should commence as soon as possible. The companies need more financing, more transparency and openness, better corporate governance and efficiency. We are confident that IPOs for Hidroelectrica and Nuclearelectrica can be very successful, attracting more investors to the market and enhancing the value of the portfolio of Fondul Proprietatea”, said Greg Konieczny, Fund Manager, Fondul Proprietatea.

Launched in December 2005, Fondul Proprietatea was established to compensate Romanians whose properties were confiscated by the former communist government. An international tender was announced in December 2008, and Franklin Templeton won the EUR 3.77 billion Fondul Proprietatea mandate in July 2009 after being selected from among seven global asset managers. Franklin Templeton officially took over as investment manager and sole administrator of the Fund on 29 September 2010.