Fondul Proprietatea (FP) bought around 5.4 million FP shares on May 16-20, for RON 3.9 M, according to information published on the stock exchange.
FP still has to buy back 639.9 million shares as part of the sixth buyback programme. At the most recent price of RON 0.73 per share, they are worth RON 467 M.
According to FP’s manager, the Franklin Templeton company, the buyback is the best option for investors at this moment, given the market’s current conditions. Moreover, the buyback programme is also implemented in order to reduce the transaction discount from 30 to 15 percent, the target requested by America’s Elliott hedge fund, FP’s largest shareholder.
In order to fuel the buyback programme, FP has liquidated assets (in 2015, Fondul sold some of its participations within Romgaz and Primcom and all of its participation within Forsev, SIFI CJ Agro, Electroconstructia Elco Cluj and Petrotel Lukoil).
The sixth programme started on 9 September 2015 and resumed on January 28 after the operations were suspended on January 12 because Fondul was planning to accelerate the programme through a public offering. However, given the high volatility registered by equity markets, FP’s manager decided to postpone the public offering. Wood & Company Financial Services, a brokerage company based in Prague, is brokering FP’s sixth programme.