The shareholders of Fondul Proprietatea, among whom the Finance Ministry holds 10.4% voting rights and the Romanian institutional investors (pension funds mainly) 39.3% voting rights, decided on February 13 to reject a proposal made by the Fund’s manager (Franklin Templeton) for the sale of stakes in the national salt company Salrom, the Bucharest Airports company, and Constanta Port.
The government initially attempted to block all the exits planned by Franklin Templeton, for which it reportedly approached the pension funds to get support, but it failed to block the sale of Fondul Proprietatea’s stake in the energy company Engie (natural gas and electricity supplier, natural gas distribution).
Fondul Proprietatea will thus sell its 12% stake in Engie and use the cash proceedings (RON 433 million, EUR 87 million) to buy back its shares.
“The reason behind our request [to stop all exits at Fondul Proprietatea] is the planned reorientation of Fondul Proprietatea on a medium- and long-term investment path, aligned with Romania’s economic development priorities. This realignment can be achieved by drawing a new mandate for the fund manager and by changing performance evaluation and remuneration indicators [for the fund manager],” minister of finance Marcel Bolos explained.
The Romanian government wants to involve Fondul Proprietatea to co-finance private equity investment funds that will be created under the National Recovery and Resilience Plan (PNRR).
Romania aims to create up to 20 such funds, with European financing of EUR 400 million and local co-financing of at least EUR 200 million.
“In perspective, the development of this ecosystem of private equity funds will offer the Romanian industry a wide, competitive, sophisticated, and deep range of investors,” minister Bolos argued.
iulian@romania-insider.com
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