By the end of Tuesday’s closing session on the Bucharest Stock Exchange, investors had offered to sell 10.109 billion shares, or 81.3% of the fund’s stock, 13.5-fold higher than the fund announced it was willing to buy back.
End-October, Fondul Proprietatea announced that it will pay RON1.11 for a share in a public tender offer to buy back 750 million shares, namely 18.7% higher than the closing price of RON0.9350 per share on Bucharest Stock Exchange, valuing the operation at RON832.5 million (EUR188.3 million). The 750 million shares represent 6% of the total number of Fondul Proprietatea shares.
The public tender offer was carried out between November 3 and December 2.
The fund’s fourth buyback program started on October 1 and was scheduled to be completed on November 27, 2015. Fondul Proprietatea plans to buy back up to 7.97% of its share capital through the fourth share repurchase program.
According to Tradeville analysis, Fondul Proprietatea shares have great growth potential and might exceed the threshold of RON1 per share on the backdrop of the buyback programs, the public offering, as well as the upcoming listing on London Stock Exchange.
In January-September, Fondul Proprietatea reported a profit of RON984.5 million (EUR221.3 million).
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 15.23% stake.