The regulations in force prohibit SIFs from buying stakes in each other, even though all the other local investment funds may invest in similar funds. The SIFs, too, may buy shares in Fondul Proprietatea (FP.RO).
On short term, this would mean an increase in demand for SIF shares, because cross share purchases would equal repurchase programs and keep their stock quotes steady on the market. SIFs have gained more than 10% on the stock market in the past month.
Some investors, however, are saying that if the SIFs were allowed to buy each other’s shares, then their bosses would cover for each other and be able to more readily defeat any attempt by other investors to take over the management.
They believe this restriction should not be removed before the 5% stake cap is lifted so that all investors would start with the same chances in their competition to take over the SIFs.
The reason why investors are interested in the SIFs is their 6.5 billion lei (EUR1.46 billion) assets.
The vice-president of the ASF Mircea Ursache himself brought up the removal of the SIF stake cap this year, and said he was in favor of eliminating any barriers hindering investors. However, the removal of the stake cap requires a law modification by the Parliament and that process takes time.
(English version by Loredana Fratila-Cristescu)