Greg Konieczny, Executive Vice President, Templeton Emerging Markets Group and Fund Manager of Fondul Proprietatea (FP), showed his skepticism about Hidroelectrica’s listing on Bucharest Stock Exchange (BVB) this year, as the state-owned company is for months away to designate an executive management.
This statement comes after FP’s Konieczny said in February that Hidroelectrica IPO is unlikely to happen before this year-end.
The fact that the government appointed on April 19 an interim Supervisory Board with a four-month mandate postpones the entire process. “This is definitely a setback in terms of quality of the governance of the company and this decision clearly delays any prospects for Hidroelectrica’s IPO this year.,” Greg Konieczny said in a press conference after the General Shareholders Meeting of Fondul Proprietatea held on April 25.
Fondul Proprietatea plans to participate in a joint bid with the Romanian state to sell a stake of 20 percent in the same market transaction, according to Konieczny.
“The higher the bid, the higher the price,” FP official said, stressing that it would also be in the government’s interest to promote a combined offer to attract important non-resident investors.
However, as regards the listing of the other state firms such as Bucharest Airports, Salrom and Constanta Port, there is still much work to be done. In this context, Konieczny welcomed the initiative to establish the Sovereign Development and Investment Fund (FSDI), which could minimize the interference of the political sphere in the private businesses.
According to FP manager, FSDI will be a ‘game changer’ and a beneficial for Romania, that could improve transparency, as it will have the capacity to create IPOs to raise funds for new investments.
Konieczny forecasts that Romania’s economy will grow more than 4 percent this year, while the cash inflows on the BVB could rise by at least USD 200-250 million with the upgrade to emerging status, which he said could effectively happen in 2019-2020.