The majority stake of 51 percent in state-owned electricity company Electrica SA will be sold via an initial public offering (IPO) on the Bucharest Stock Exchange and London Stock Exchange, according to a Government decision project that was published on Thursday (April 10).

Electrica will issue new shares representing 105 percent of its current capital which will be offered to local and foreign investors. Officials from the Romanian Energy Department, which coordinates the privatization, estimate that the share sale will take place in June.

They decided on a dual listing in which Global Depositary Receipts (GDRs) will be sold on the London Stock Exchange, as they want to generate a share demand of at least USD 800 million to USD 1 billion. This would allow for the offering to be oversubscribed and would push up the evaluation of the company and the share price after the listing, they said.

Electrica holds the electricity supply and distribution in Transylvania and the northern part of Muntenia. The group had revenues of RON 5.5 billion RON (EUR 1.25 billion) in 2012.

editor@romania-insider.com