MUGESCU, BVB:  "We have made it our goal to have 10-20 listings on the AeRo platform, this year"

The Bucharest Stock Exchange (BVB) wants to complete 10-20 listings this year, on the AeRo alternative trading system, which will be launched on February 25th, Bogdan Mugescu, a specialist in the Business Department of the BSE told us on Friday.

He said: "At the current moment, I find it hard to say how many companies will switch from the Rasdaq to the AeRo, because the General Shareholder Meetings are still in the process of preparation. But so far, ten companies have expressed their interest in moving to the AeRo. We have made it our goal to have 10-20 listings of private companies in 2015, to prove that AeRo works. This is something that we haven't had so far, a mechanism for private companies to make money on the Stock Exchange".

Bogdan Mugescu told us that the target of the development department is to get one listing a week for private companies, "or at least three listings a month", starting next year. In his opinion, the first companies that will come to the AeRo platform are those in the IT or services sector, and those can raise several hundred thousand Euros from private placements.

The BSE official told us that the Bucharest Stock Exchange reserves the right to select the companies that move from the Rasdaq to the AeRo: "They must be companies that are financially solid, they must have a business plan for development and must want to use the capital market for their benefit".

Bogdan Mugescu claims that the BSE checks the companies' history to make sure they haven't been involved in acts of tax evasion, corruption, money laundering, frauds, etc.

"Having experience with the Rasdaq does not automatically involve experience with being a public company, and authorized consultants will make sure that all companies that come from the Rasdaq to the AeRo will behave like public companies, especially when it comes to the reporting part", Mr. Mugescu said.

In his opinion, the reporting rules of the Aero are far stricter than on the Rasdaq, because the companies are required to report audited annual reports. The companies will also have to report their financial results bi-annually. "We also encourage quarterly reports, even though they are not mandatory, but they can be used as marketing instruments, as well as all the current reports in a company", the BSE official said, and he stressed: "The role of an authorized consultant is, particularly, to ensure that the companies listed on the AeRo comply with their status of public company".

Bogdan Mugescu also says that the AeRo has less strict criteria for listing, compared to the regulated market. Thus, the minimum predictable amount of a company must be at least 250,000 Euros, compared to one million Euros on the regulated market, the free-float must be 10%, the listing can be done through private placement, and not only through an IPO, and the cost of the listing is several hundred lei.