RAEF to reinvest $40m

Investment fund Romanian American Enterprise Fund (RAEF) will reinvest on the Romanian market the money obtained for its Banca Romaneasca (Romanian Bank) stake, RAEF VP Horia Manda told Ziarul Financiar.

“We will aim to consolidate the shareholding positions we already hold in several companies and will also look for new investment opportunities, mainly in the financial and energy fields,” Manda stated.

RAEF has recently concluded an agreement for the sale of some 83% in the capital of Banca Romaneasca to the National Bank of Greece (NBG), under a transaction estimated at $40 million.

The sale agreement is pending endorsement from the National Bank of Romania (NBR).

Reinvesting $40 million on the Romanian market is a big decision for RAEF, considering the fund’s initial capitalisation stood at 60 million dollars in 1994.

RAEF is now the significant or main shareholder in several big Romanian companies, such as Policolor Bucharest (paint), Rolast Pitesti (synthetic rubber), Motoractive (leasing), Tec Miaco (food industry), Comtel Rom (hotel operator) and Titan Mar-Marmosim (marble).

Moreover, RAEF set up a mortgage credit company this year and an energy investment company, with support from several banks, such as the European Bank for Reconstruction and Development (EBRD).

RAEF bought most of its stakes five or six years ago. Consequently, as these investments have “matured,” the funds started looking for exit options this year.

“We are looking for exit variants, but, in some cases, the companies are operating in sectors that are not doing very well at the moment, so that we are in no rush to sell,” Manda stated.

In the case of many companies from its portfolio (Policolor, Rolast, Titan Mar, Tec Miaco), RAEF is a shareholder together with another important investment fund operating on the Romanian market – Romanian Investment Fund (RIF).

RIF was supposed to end its life span this year, but the fund’s shareholders are very likely to vote for an extension of two or three years.