Impact issues $4m shares

Contractor and developer Impact Bucharest is planning to issue 53 million shares worth 132.5 billion ROL ($4 million). The shares, with 1,000 ROL in face value, will increase the company’s capital to 175 billion ROL. This is one of the biggest stock issues the Stock Exchange has ever seen. Impact has been listed since 1996 and is one of the few Romanian private enterprises having opted for share issues on the capital market as a means to obtain financing.
In fact, this move is part of a broader project. The company aims to attract 135 million dollars from the financial markets in the next ten years, to fund the construction of 4,200 houses and villas under 55 residential projects. The total value of investments is set to reach 330 million dollars.
The first step is an investment in Ploiesti, which will be mainly covered by the issue of the 53 million shares.
The company’s chairman Ioan Popp says the issue price is 2,500 ROL, with 1,500 ROL accounting for the issue premium. The shares will be first offered to the current shareholders, in compliance with the preemption rights. The unsubscribed shares will be then publicly offered or may be annulled. The General Meeting of Shareholders will convene on February 8 and all those that will have bought shares by January 29 can attend.
The villas target those families able to pay monthly instalments worth 400-1,200 dollars. According to Ioan Popp, the company has commissioned market surveys about the demand and supply structure and the available lands. “The inhabitable area per capita revolves around 11 sq. metres in Romania, while in France it stands at 42 square metres,” Popp said.
The company is also considering bond issues, banking loans and a real estate fund as financing options.
The first bond issue, worth $1.5 million, has been authorised by the National Securities Commission (CNVM) and the offer will begin on February 10.