Romanian Farming Equipment Maker Mecanica Ceahlau Seeks 8.0 Mln Lei (1.9 Mln Euro) in Capital Hike

The company plans to use the proceeds from the hike for working capital and to finance its business expansion, Mecanica Ceahlau said in a statement.

The company is going to issue 80 million new shares with an issue price equal to their face value of 0.10 lei each. Shareholders on record as of September 21 will be able to subscribe one new share for each two shares they own. Unsubscribed stock will be cancelled.

Mecanica Ceahlau shares were trading up 5.74% at 0.129 lei by 0901 GMT on the Bucharest Stock Exchange on Tuesday.

As of June 30, investment fund SIF 2 Moldova owned a 55.1% stake in Mecanica Ceahlau and Eastern Eagle Fund Ltd Winward held a 12.8% stake. Smaller shareholders held the balance, according to data of the Romania’s Central Depository.

The company slumped to a loss of 2.9 million lei in the first half of 2009 versus a net profit of 247,700 lei a year earlier, while its net turnover halved to 8.9 million lei.

Mecanica Ceahlau (www.mecanicaceahlau.ro), based in Piatra Neamt, in northeastern Romania, is one of the largest companies of its type in Romania.

(1 euro=4.2397 Romanian lei)