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The London listing of Fondul Proprietatea (The Romanian Property restitution Fund) will take place in April or May, told energynomics.ro the Fund`s manager, Greg Konieczny. Meanwhile, there is a setback over the nature of the listing instruments, and most likely will be used global depository rights (GDR) in the absence of an agreement from the Financial Supervisory Authority (ASF) for the use of the much cheaper DIs (Depository Interests).
“We intend to list it through GDR, in April or May, that if we do not get to use DI after an eventual ASF agreement, in which case we will return to these tools, which we believe are an instrument much more beneficial for the local market, too, ” said Konieczny for energynomics.ro.
The difference between DI and GDR
DIs require a simpler procedure without requiring the submission of a prospectus, are cheaper than GDRs and it’s important to note that many closed-end funds are traded in London by DI’s.
The Listing of the Property Fund through DIs would provide significant benefits
The Listing of the Property Fund through DIs would provide significant benefits not only the Fund, but also the entire market in Romania, for several solid reasons: it attracts a large number of new foreign investors that are currently active in Romania; brokers would increase coverage from analysis reports, which will promote Romania among international clients, which in turn will gain a better understanding of unlisted companies in the portfolio, especially before their IPOs.
Once listed, the PF will be the third largest fund after the NAV and market capitalization of the 422 funds listed on the LSE, increasing visibility and Romania Fund internationally.
“DI sites would allow existing shares to be traded efficiently and easily on the London Stock Exchange and without requiring a separate tool to be listed in London. If GDRs are used, investors have to pay a conversion fee to the custodian bank issuing the GDRs (every conversion). GDRs listing would require a separate instrument and would require a prospectus for their issue,” said Konieczny, quoted by econtext.ro.
Property Fund shareholders approved an agreement providing for a new term for the administrator, valid until July, for the fund’s listing in London.
