The shareholders of Romania's biggest investment fund, Fondul Proprietatea (FP), voted to extend the fund's life until 2031, with an option for the general shareholders' meeting to approve extension periods of five years afterward.

Created in 2005 to compensate the people whose properties had been confiscated by the communist regime, Fondul Proprietatea received stakes worth about EUR 4 billion in some of the biggest Romanian companies.

After its listing, in September 2011, foreign investment funds bought significant stakes in Fondul Proprietatea and pressured the fund manager - Franklin Templeton - to take stronger action and reduce the large discount at which the fund's shares were trading (compared to its net assets). Thus, Franklin Templeton started selling Fondul Proprietatea's most liquid holdings and distributing the money to the shareholders via buyback programs.

Recently, FP concluded another buyback offer, which was heavily oversubscribed. Shareholders placed sale orders for 1.37 billion shares, respectively 828.1% of the target volume, which means that the offer was oversubscribed more than eight times. The total value of the offer amounted to RON 229.3 million (EUR 47 mln).

FP has a market capitalization of RON 10.8 billion (EUR 2.2 bln).

In the last year, FP shares registered an increase of 20.2%, and the discount between the share price and the net asset value (NAV) per share dropped to just 7%. 

andrei@romania-insider.com

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