The latest regulations issued by the National Securities Commission (CNVM) with regard to public takeover offerings linked to delisting are again sparking fierce controversies. Yet, this time, it is not the minority and majority shareholders that are in conflict, but independent and bank-owned brokerages.
In line with a decision CNVM issued last week, minority shareholders targeted by a public takeover bid with a view to delisting can, at the request of the brokerage that acts as an intermediary of the offer, use banking units to subscribe to the offer.
This measure was adopted, according to CNVM, in order to cut costs linked to the bidding (so far, subscriptions were only made at the headquarters and branches of brokerages). Representatives of independent brokerages say, though, that the decision favours brokers owned by banks, which can benefit from the needed space rapidly and for free.
In the wake of CNVM’s decision, independent brokers, too, have the right to use banking units, provided that they mandate a broker who should be permanently present in the respective unit during the bidding process.
“This measure has a deep discriminatory character, precluding competition at the same time. The decision says we can also use banking units, but how could I come up with 20-30 brokers to be present during a bidding process? Thus, a series of advantages are artificially created to benefit brokerages owned by banks. I see no use of this measure, especially as all the money will eventually reach sellers by mail,” states Petru Prunea, chairman of SIVM Brokers, the largest independent brokerage in Romania.
So far, minority shareholders subscribing to takeover bids have been forced to personally file the necessary documents at the central headquarters or branches of the brokerage, which then sold the shares that were put out. The money was received subsequently, after the bidding process was over, being transferred into the account opened with the brokerage or mailed at home.
Due to the small number of shares owned by coupon-holders and to the high expenses linked to the transfer to a brokerage, most of them have not subscribed to the $100m takeover bids for delisting.
“I think CNVM has issued the right decision since it anticipates the adoption of the consolidated law on the capital market, a law that will allow banks to offer direct services on the capital market as well. As a matter of fact, I think this will be the pattern: banks will keep their brokerages, although they will be granted permission to directly operate on the market, and will allow the latter to use their branches,” says Dragos Neacsu, chairman of Raiffeisen Capital Investment, one of brokerages benefiting from the support of a powerful retail banking network. laurentiu.ispir@zf.ro