Digi IPO boosts Romanian companies' mkt capitalisation to 9-yr high - BVB

Digi IPO boosts Romanian companies' mkt capitalisation to 9-yr high - BVB Bucharest Stock Exchange Author (BVB) License: all rights reserved.

BUCHAREST (Romania), May 19 (SeeNews) - The market value of the Romanian companies listed on the Bucharest Stock Exchange (BVB) has exceeded 20 billion euro ($22.3 billion) this week after DIGI Communications [BSE: DIGI] listed, the BVB said on Friday.

This is the highest level of market capitalisation of Romanian companies in the last 9 years, BVB said in a press release.

On the day of its IPO, DigiI was the most traded ticker in a single day from the last three and a half years with 3,270 transactions, BVB data showed.

"Romania is on the radar of investors as it offers a level of growth and stability which is rare in today's world, coupled with dynamism and creativity - becoming a friendlier place to do business than ever before. The entrepreneurial companies with national or regional ambitions now see the stock exchange as a natural habitat for their business," BVB CEO Ludwik Sobolewski said in the release.

This week witnessed new heights for 2017 for the shares listed on the regulated market of the bourse, BVB pointed out.

On Monday, BVB's main blue-chip index BET climbed to 8,460 points, while the BET Total Return index (BET-TR) reached 10,633 points, topping the largest values reached so far this year.

Companies from BET such as Romanian lender Banca Transilvania [BSE:TLV], natural gas producer Romgaz [BSE:SNG], investment fund Fondul Proprietatea [BSE:FP] and oil and gas group OMV Petrom [BSE:SNP] also had significant trades throughout this week, BVB noted.

"The macroeconomic data, the level of dividends and the growth coming from the share prices are strong arguments for Romania to be the best destination where money can produce added value, while this momentum is building up strength to persuade even the most skeptical investors to place their money on the local capital market,"  BVB president Lucian Anghel said.

"At this value, the market capitalisation of domestic listed companies on the BVB is around 12% of Romania's GDP," he added.

Netherlands-based telecommunications company Digi Communications, which is the majority owner of Romanian company RCS&RDS, listed on the BVB on Tuesday following a record IPO of 944 mln lei ($231 million/207 million euro), selling a 25.6% stake at a price of 40 lei per share.

However, Digi's shares went downhill on Wednesday, when the company said it was notified by Romania's anti-corruption body DNA that its CEO and several managers are under investigation over suspected bribery and money laundering.

Prosecutors are investigating a former Romanian professional football league chief who is suspected of receiving a bribe in exchange of granting Digi Communications the exclusive television rights over some matches.

The CEO of Digi Communications and of RCS & RDS, Serghei Bulgac, has been notified by the DNA that he is a suspect in this investigation in relation to the offence of money laundering, Digi said in a statement submitted to the BVB on Wednesday.

"The possibility of this happening in the course of DNA’s investigation was anticipated and disclosed in the Prospectus.(...) The Company does not currently expect the investigation to interfere with its daily operations in any material manner," Digi also said at the time.

Digi shares were traded at 39.8 lei, up 2.05%, as of 1625 CET on the BVB on Friday.

(1 euro=4.5616 lei)


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