Astra Ploiesti refinery, indirectly held by businessman Ioan Nicolae, is selling, through a public primary offer, a number of 24.9 million shares, with a face value of 1,000 lei, the offering price per share standing at 1,010 lei. At the same time, the trading price on Bucharest Stock Exchange on Thursday reached 670 lei per share, 33 percent lower as compared to the price the company offers shares to investors.
The intermediary of the offer is Equity Invest Bucuresti securities company and the offer will be placed during the period July 18-24, having been authorised by the National Securities Commission on July 7.
According to the decision issued by the company’s Management Board on March 22, 2000, Astra Romana Ploiesti Refinery was to raise its share capital by 30.551 billion lei, representing contributions in kind by the company’s majority shareholder, Interagro Bucuresti, held by Ioan Nicolae, in line with stipulations included in the sale-purchase contract sealed with the State Ownership Fund back in 1997. The company’s General Assembly of Shareholders (AGA) approved the share capital increase through contributions in kind by the main shareholder. At the same time, AGA decided that a number of 30,551,215 shares with a face value of 1,000 lei would be issued in exchange for the contribution in kind brought by Interagro Bucuresti.
AGA also decided that a number of 87,179,864 shares with a face value of 1,000 lei would be issued so that the company’s shareholders included in the shareholding registry by April 4 and who did not participate in the capital raise through contributions in kind should exert their pre-emption right.
Three important shareholders of the company contributed to the capital raise: Broadhurst Investments Ltd. (holding a stake of 17.14 percent in the company), Asigurari Asirom insurance company (with a stake of 32.09 percent) and Hesket Enterprises Ltd. (which has a contribution of 3.59 percent in the capital of Astra Romana), which subscribed all the shares they were entitled to.
The price shares were issued at was equal to the face value, namely 1,000 lei per share, a level that was significantly higher than the price this stock was traded at on the market (700 lei per share). That is why small shareholders preferred not to participate and thus stock that was offered on Friday through the public offer remained available.
AGA decided that in case there should be stock left non-subscribed, it will be annulled.
Last year, the company registered gross profit of 71 billion lei, against turnover worth 1,777.1 billion lei. For year 2000, the company estimates gross profit of 121.8 billion lei and total revenues of 3,374 billion lei.