SIF Transilvania attempts further capital increase

SIF Transilvania announced it intended to capitalise the net profit derived in 2006 and to offer its shareholders free shares instead of dividends. The announcement was followed by a 4% increase in the companyes stock price. SIF Transilvania called a meeting of the General Assembly of Shareholders for April 27, where the main topic on the agenda will be the increase in the companyes share capital by 54.6 million RON (16 million euros) by integrating the net profit derived in 2006. If the proposal is passed, each SIF Transilvania shareholder will receive a free share for each share they currently hold; therefore the company would double its share capital to 109.2 million RON (32 million euros). SIF Transilvania representatives were not however, available for comment on further details. SIF Transilvania made another attempt to increase its share capital last year, but it did not manage to gather the necessary support to pass this proposal. In order to pass a proposal, at least 50% of the companyes shareholders must vote directly, either through a mandate or by correspondence. SIF Transilvania managed to gather the support of 38.6% of the shareholders at the second meeting last year, which was an insufficient number to pass the capital increase proposed. This occurred as a result of foreign investors not participating in the meeting, as foreign investment funds, especially the US-based ones, opted to receive dividends rather than free shares.