This year, SIFs” General Meetings of Shareholders have not managed to bring the surprises some investors were expecting.
The financial investment companies were unable once again to meet the minimum 50% quorum needed to legally organise the Extraordinary General Meetings. As a result, the proposal by SIF Banat-Crisana and SIF Transilvania of capital increases by bonus shares could not be put into effect.
The main absentees were the representatives of investment funds, whose presence could have pushed the quorum beyond the 50% level. The management of the two SIFs carried out a whole campaign in order to make shareholders attend the General Meetings, either in person, through representatives, or by resorting to distance voting.
Though they sent letters to shareholders, they couldn”t persuade enough shareholders to at least send their votes by post.
Instead of bonus shares this year, SIFs will grant their shareholders cash dividends again. SIF Banat-Crisana and Transilvania will each disburse a gross dividend of 0.05 RON/share, Muntenia and Oltenia a gross dividend of 0.06 RON/share, while SIF Moldova is going to distribute a gross dividend of 0.067 RON/share. The yield of the dividends due to be granted by SIFs is a mere 2-3% of the current price of stock on the stock exchange, that is not even half the interest brought by a banking deposit over a period of one year.
The market”s attention has primarily centred on the General Meetings of SIF Banat-Crisana and Transilvania this year, where the proposal to increase the capital through the inclusion of profit reserves has also been on the agenda. However, from the very beginning, these capital raises were estimated to stand little chance of success because of the high shareholder dispersion of SIFs, and the fact that some of the major investors in these companies were supposedly more interested in getting cash dividends than bonus shares.
However, SIF Banat-Crisana failed to get together more than 42.7% of the capital, even though it had been calling shareholders to the Extraordinary General Meeting for a second time, while for SIF Transilvania the degree of attendance was almost 38.3%.
“We did not meet the quorum especially due to the fact that major investment funds did not attend the General Meeting. This happened in the context where around 20% of SIF capital is controlled by such investors,” specified Florian Firu, the deputy general manager of SIF Transilvania.
At the same time, in the case of SIF Banat-Crisana, where high percentages of the capital are held by Slovenian investors, the absence of many of them was reflected in the degree of attendance the company managed to attain. The General Meeting of SIF Oltenia stirred even less interest as compared to the other SIFs that had the granting of free shares on their agenda.
catalin.ciocan@zf.ro; vlad.nicolaescu@zf.ro