“Franklin Templeton Investment Management, administrator of Fondul Proprietatea as well as Newtyn Management, ING Pensii and Evermore Global Advisors, express their concern regarding the changes recently adopted by ANRE to the methodology for setting up the rate-of-return regulation (ROR), as well as the recent proposal of cutting the rate-of-return for electricity distributors from 8.52% to 7.45%,” Fondul Proprietatea said in a statement.
The changes will mainly affect Electrica Distributie Muntenia Nord, Electrica Distributie Transilvania Sud, Electrica DistributieTransilvania Nord, EON Moldova Distributie, Enel Distributie Banat, Enel Distributie Dobrogea and Enel Distributie Muntenia, in which the fund holds stakes.
“The constant changes in the regulation framework turn the business environment into an unstable and unpredictable one, hindering companies from undertaking investment programs,” Fondul Proprietatea notes.
Such negative changes might also jeopardize the success of listings on Bucharest Stock Exchange or privatizations, the fund said.
Fondul Proprietatea was set up in 2005 to compensate Romanians whose properties were seized during communism. U.S. hedging fund Elliott Associates is the fund’s largest shareholder, with a 17% stake, followed by US bank Morgan Stanley with 5%.