Estimates on the market suggest a ten-time oversubscription of Transgaz shares. Analysts are forecasting a 30 percent increase of Transgaz share market prices following their listing on the stock exchange, due to the high rate of oversubscription.
The General Assembly of Transgaz shareholders is to approve the trading of allocation rights until shares sold in the initial public offering (IPO) are registered.
"The issuing and trading of allocation rights are part of our plans and of the Transgaz public offer. Furthermore, this option was approved by the General Assembly of shareholders," according to a statement made to Business Standard by Dana Mirela Ionescu, President of Raiffeisen Capital&Investment (RCI), the brokerage house managing the Transgaz public offer and listing on BVB. RCI was the initiator of these instruments on the Romanian market. The Romanian National Securities Commission (CNVM) approved the rules for allocation rights last week.
"The General Assembly should consider this opportunity, because it constitutes an advantage to those who subscribe, and could stimulate further subscription," said Transgaz General Manager, Ioan Rusu. The company will sell some 1.17 million new shares through public offering at the end of this month, at a starting price of €57 per share, but the company's listing on the stock exchange and the first share transactions might occur only next year. For each share, an allocation right would be issued, marketable and freely distributed to subscribers. These titles will allow buyers to obtain the first results of their investment. "In Poland, where such trading instruments have been traded efficiently for several years now, the prices of allocation rights can be lower (discount) or higher (premium) than the market share price, depending on liquidity and investor-perceived risks. However, in the case of Transgaz, the risk of cancelling the capital increase through public offer is non-existent," added Dana Mirela Ionescu.
