Romania, FP selected a consortium of investment banks for Hidroelectrica’s IPO

03.Oct 2022.

Private investment fund Fondul Proprietatea (FP) announced that, in cooperation with Hidroelectrica, it has selected a consortium of investment banks, which represents a crucial milestone in the upcoming initial public offering (IPO) of the largest electricity producer in Romania.

According to Romanian media, the contracted consortium consists of Citi, Morgan Stanley, Erste and Jefferies (global managers), Bank of America, Barclays, UBS, UniCredit and Wood (joint managers) and respectively Banca Transilvania and Swiss Capital (co-lead managers).

The role of the selected investment banks in the IPO process is to recommend the optimal structure of the transaction, promote the equity story of Hidroelectrica among local and international investors, place securities in the IPO, as well as assist with the listing process.

Chairperson of the Board of Nominees Ilinca von Derenthall said that the IPO and the subsequent listing of Hidroelectrica will bring significant benefits to the Romanian capital markets and Romania as a whole, as it has great potential to attract significant domestic and foreign investors for the Romanian leading electricity generation company.

Rothschild & Co is Fondul Proprietatea’s financial advisor in this transaction. Hidroelectrica’s listing will take place after an initial public offer in which Fondul Proprietatea plans to sell at least 15 % of the company’s shares, out of its 20 % stake. The Romanian state, which holds the majority stake of 80 % in Hidroelectrica, has approved the listing but is not willing to sell any shares.

Last month, after the meeting of Romanian Prime Minister Niculae Ciuca and the delegation of FP, it was decided that the initial public offering of Hidroelectrica will be launched by the end of June 2023.

Hidroelectrica’s IPO has been expected for many years. In April 2012, a consortium made of BRD, Citigroup, Societe Generale and Intercapital Invest was selected to manage the sale of a 10 % stake in Hidroelectrica, but the company went into insolvency a few months later.

After Hidroelectrica completed its restructuring process, in January 2014, the Government carried out another selection process and chose Raiffeisen Bank and Morgan Stanley to manage the sale of a 15 % stake in Hidroelectrica through IPO. However, this sale did not take place.