The listing of the power company Hidroelectrica is necessary for the Romanian capital market in order to upgrade from the frontier market to the emerging market status and the Romanian state will be the main beneficiary of this promotion, said Lucian Anghel, Chairman of the Bucharest Stock Exchange.
OMV Petrom, Romgaz, Transilvania Bank are also on the list of companies that are eligible for promoting Romania from frontier to emerging market.
The conditions imposed by the rating agencies are very strict and companies of certain size can be found only in the state sector. The Romanian state will be the main beneficiary of this status improvement, for which the listing of Hidroelectrica is needed, said Anghel.
The Chairman of the Bucharest Stock Exchange explains that obtaining the status of emerging market will increase the value of companies.
“On other markets that have been upgraded from frontier market to emerging market the average value of the share price index is increased by 40-50 % to 200%. It’s a fantastic growth in a period of two years, says Anghel. This is a once in a lifetime situation and if we succeed, the value of the Romanian companies will increase.
The head of the IMF mission in Romania Reza Baqir said that the listing of companies such as Hidroelectrica would raise the status of the Romanian market and reduce credit costs.
During an extraordinary meeting held on February 7, shareholders of Hidroelectrica extended the validity of the letter of commitment with a consortium of Morgan Stanely – Raiffeisen for listing on the stock exchange until August 7, 2017.
In 2013, the Romanian government adopted a decision on listing the company on the Bucharest Stock Exchange by capital increase and initial public offering for the sale of package of shares representing 15% of the existing equity before the increase.
The state owns 80% shares in Hidroelectrica, while the Proprietatea Fund holds 20%.