Elliott Associates funds reach 12.9% in Romania's Fondul Proprietatea

Manchester Securities Corp. and Beresford Energy Corp, both subsidiaries of Elliott Associates investment company have continued to buy shares in Romania's Fondul Proprietatea on the Bucharest Stock Exchange in January, reaching a 12.9 percent ownership level in the fund. The fund's shares went up in price on the BSE in the last seven days. The Fondul Proprietatea shares were trading at RON 0.48 per shares on Monday (January 30) on the BSE. The share price growth started a week ago, when the FP shares were priced slightly below RON 0.47.

Manchester Securities Corp's latest transaction at the end of last week involved the purchase of over 132 million Fondul Proprietatea (FP) shares – or 1 percent of the fund, at a price of RON 0.47 per share - over EUR 14.5 million in total. Last year, Manchester started buying Fondul Proprietatea shares together with Beresford Energy Corp, reaching 12.9 percent in the fund in January. Another minority shareholder is City of London Investment Management Company Limited, with 7 percent, and individual investor Georgia Palade van Dusen, with 6.3 percent of the shares. Shareholders are required to submit notifications to the BSE when exceeding 5 percent in FP shares. Fondul Proprietatea's shares have been floating on the Bucharest Stock Exchange since the beginning of last year. The price per share went down continuously over the last 12 months, from a maximum of RON 0.63 per share to a minimum of RON 0.41 per share, only to start increasing again at the beginning of 2012. The fund is managed by Franklin Templeton. In November last year, 40 percent of Fondul Proprietatea was in the hands of foreign institutional investors. Romanian individuals had 36 percent of the shares, while Romanian institutional investors had 11.3 percent of these shares. Foreign individuals had 9.5 percent, while the state – through the Public Finance Ministry only had 1.53 percent of the fund left in its ownership, according to its report. Fondul Proprietatea’s secondary listing on the Warsaw Stock Exchange remains to be done in the first half of this year, even if the process is slowed down by discussions on legislation with representatives of National Securities Commission, said Greg Konieczny, Executive Vice President Templeton Emerging Markets Group and Portfolio Manager at Fondul Proprietatea. Fondul Proprietatea was created in 2005 as a joint stock company with a special purpose to provide compensation to the persons whose real estate assets had been confiscated by the Romanian state during the communist regime and who can no longer receive restitution in kind. The Romanian investment fund posted a profit of around EUR 128 million in 2011.