The management of Roca Industry wants to split the nominal value of the share and issue bonds

• The company wants to attract up to 50 million lei to finance the acquisition of some companies

The shareholders of the building materials holding company Roca Industry (ROC1) are summoned, on September 2, to approve the division of the nominal value of the company's shares and the launch of a program of corporate bond issues, according to the information of the issuer published on the website of the Stock Exchange Bucharest Stock Exchange (BVB).

The proposed split ratio is one to ten, which means that the nominal value of the share will change from ten lei per share to one lei per share, and the share capital of Roca Industry, amounting to 248.67 million lei, will be composed of 248.67 million shares, according to the information in the convenor.

According to supporting documents published on the company's website, the reasons for the stock split are related to the diversification of the investor base, improved liquidity, greater flexibility for shareholders and increased share price.

"A lower price per share makes investing in the company's stock more accessible to retail investors, so Roca Industry can attract a wider spectrum of investors, including those who may be reluctant to invest in a single high-priced stock" , it is stated in the documents related to the AGM. "By reducing the price of Roca Industry shares and through a higher degree of accessibility, it is expected that the number of transactions and their volume will increase, thus increasing liquidity on the market. At the same time, the increase in liquidity is expected to reduce the difference between the offered and asked price (bid-ask spread), thus contributing to a lower trading cost for investors".

In addition, Roca Industry's management believes that the company's shares are undervalued, taking into account the market valuation of the entire holding company and the growth and development potential of its subsidiaries.

"Management expects demand and supply for Roca Industry shares to increase, which could lead to a higher market value of the company, closer to the value obtained following a fundamental analysis," the documents also state.

Also on September 2nd, Roca Industry shareholders will be put to a vote to approve a program - carried out in one or more rounds - of issuing corporate bonds with a maximum total nominal value of 50 million lei or the equivalent of this amount in euros.

The annual interest will be up to 12%, with a maturity of a minimum of three years and a maximum of five years for each issue, the bonds can be redeemed in advance at the initiative of the company. The securities will be offered through public offers and/or private placements, the program being valid for a period of two years from the date of shareholder approval.

"The purpose of the bonds is to finance full or partial acquisitions of new companies for the diversification and synergistic optimization of the company's investment portfolio," the convening letter states.

According to the AGM documents, the management of Roca Industry has in the initial analysis potential new companies that can meet the criteria to come under the holding's umbrella, but without advanced negotiations.

Another item on the agenda of the shareholders' meeting at the beginning of September is related to the extension by an additional period of three years of the maturity of some loans as follows: two loans to Colorock13 SRL (company delisted as a result of the merger by absorption by Sarcom - the current Evolor) in amounts of 24 million lei and 5.1 million lei; a loan to Doorsrock4 SRL (company delisted as a result of the merger by absorption by EED) in the amount of 0.35 million euros; a loan to Nativerock1 SRL (company delisted as a result of the merger by absorption by DIAL) in the amount of 6.5 million euros, of which seven million euros were converted into DIAL's share capital; a loan to DIAL in the amount of 1.2 million euros; the loans taken over by the company as assignee, as a result of the conclusion of the receivables assignment agreement with Roca Investments vis-à-vis ELP, in total amounts of 1.06 million euros and 2.03 million lei; as well as the loan granted to the company by Roca Investments, in the amount of 1.2 million euros.

ROCA Industry is the construction materials holding of ROCA Investments, which owns about 66% of the company.