Romania’s Fondul Proprietatea prepares new buyback offer, waits for regulator’s OK

Romanian investment fund Fondul Proprietatea (BVB ticker: FP) intends to repurchase 750 million of its own shares in one go via a public buyback offer, the fund announced on Monday, October 20. The fund’s manager Franklin Templeton is waiting for the approval from the Financial Supervisory Authority (ASF) to launch the buyback tender offer. “Full details of the offer will be announced after receiving the approval from the ASF, which should take place within 10 business days according to the regulations in force,” Franklin Templeton announced. The public offer is part of the fund’s fourth buyback program which started at the end of September and which targets 991 million of its own shares. The fund has repurchased 36.3 million shares until October 16, when it paused repurchases to prepare the public offer. The fund has spent some EUR 7.7 million for the recent repurchases. Raiffeisen Bank is manages the share repurchases for the fund, including the tender offer. The tender offer is the second transaction of this kind made by Fondul Proprietatea. One year ago, the fund made a buyback offer for 600 million of its own shares paying RON 1 per share, or EUR 135 million for the whole package. The offer was 14 times oversubscribed by the fund’s shareholders. The buybacks are the main instrument used by the Fondul Proprietatea’s managers to increase the share price and reduce the discount to its net asset value (NAV) per share. FP’s share price declined by 6% compared to the all-time high of RON 0.96 per share at the end of September. The closing price on Monday, October 20, was RON 0.8965, 28% below its NAV per share of RON 1.2438, at the end of September. Andrei Chirileasa, andrei@romania-insider.com