When OMV announced the capital increase in May, its stock was trading for about EUR30.
Moreover, the underwriters of the offering agreed upon a maximum subscription price of EUR33, hoping to raise EUR900 million, but only managed EUR750 million in the end. The ten banks to have brokered the deal will get about EUR25 million.
Experts on the market say that if the ten banks (Bank of America – Merrill Lynch, Barclays, Deutsche Bank, JP Morgan, UniCredit, BNP Paribas, Credit Agricole, Erste, Raiffeisen and Societe Generale) had to take a 16% lower price than the maximum sought from this operation, the brokers of OMV Petrom’s (SNP.RO) offering (which include some of the above-mentioned banks), whereby the state wants to sell 9.84% on the bourse, will have a hard time getting a price to match the government’s expectations.
“Investors are interested, but this is a buyer’s market now because of the many capital increases announced, especially by banks, and many governments are forced to conduct privatizations. There’s ample supply and investors seek to get as attractive a price as possible,” says Valerian Ionescu, head of the BCR’s capital market trading department.
Under the circumstances, Petrom’s offering, which should have started early in July at the latest, might be postponed. The Economy Ministry clearly said so in an answer sent to ZF in mid-April, after selecting the broker.