Monday, October 14, 2013

Romania to Sell 15% of Romgaz, Biggest Gas Producer, This Year

Romania plans to sell 15 percent of Romgaz SA, its largest natural-gas producer, in an initial public offering this year as part of the eastern European country’s agreement with the International Monetary Fund.

Romgaz shares will trade on the Bucharest Stock Exchange as well as in London as global depositary receipts, Romgaz and the government said in a joint statement today. Romania will keep at least 70 percent of Romgaz and property-restitution fund Fondul Proprietatea SA will have a 15 percent stake in the company. The total value of the offering may reach as much as 600 million euros ($814 million), Gabriel Dumitrascu, head of the Energy Department’s asset-sale program, said on Sept. 19.

“The listing of Romgaz is part of the ambitious program initiated by the Romanian government to introduce private investors into strategic companies in the context of reforming the energy sector,” Energy Minister Constantin Nita said in the statement.

Romania’s government must complete the sale by the end of November to meet the terms of its newly-signed 2 billion-euro accord with the IMF to overhaul state companies. The nation sold to the public a minority stake in nuclear power generator Nuclearelectrica SA last month as part of the deal.
Asset Sales

The country also sold a 15 percent stake in natural-gas grid operator Transgaz SA in April and an additional 15 percent stake in utility Transelectrica SA in March last year.

Prime Minister Victor Ponta’s government may approve next week a price range in Romgaz’s sale, which should start no later than Oct. 28 and end by Nov. 9, Bursa newspaper reported today, citing unidentified people familiar with the matter.

The offering could start as soon as the end of this month, Dumitrascu said in an interview on Oct. 9.

Romgaz’s earnings before interest, taxes, depreciation and amortization fell to 1.1 billion lei in the first half of 2013 from 1.2 billion lei a year earlier, it said in the statement. Sales declined to 3.8 billion lei in 2012 from 4.2 billion lei in 2011.

Goldman Sachs Group Inc., Erste Group Bank AG, Banca Comerciala Romana SA and Raiffeisen Capital & Investment SA are managing the sale.

To contact the reporter on this story: Irina Savu in Bucharest at

To contact the editor responsible for this story: James M. Gomez at

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