THE ROMPETROL TENDER OFFER AWAITING A NEW PRICE CNVM misses out on EUR 1 million in fees from the "Rompetrol" deal

Even though it did its best to help minority shareholders get a higher price in the tender offer for "Rompetrol Rafinare" (RRC), the Romanian Securities Commission (CNVM) was left out in the cold by some of the minority shareholders it did its best to protect, as they chose to deal with the Kazakhs directly, in 25 deals with a negotiated price. As a result, the CNVM lost over one million Euros in fees, money which it could have made if the 3.3 billion shares of RRC which were transferred yesterday would have been acquired as part of the tender offer on the Regular section of the market.

The National Securities Commission takes 2% off the value of a tender offer and 0.08% off trades performed on the regular section of the stock exchange. Therefore, the Commission would have made around 4.9 million lei (EUR 1.2 million), if the 3.3 billion shares of RRC which were transferred on Monday through Deals, would have been subscribed as part of the tender offer through the Regular section of the market, at a price of 0.0741 lei/share. Since those shares were traded on the Deal section of the exchange, the Commission will only make 198,000 lei in fees (close to EUR 50,000).

Losing out these fees deals a heavy blow to the budget of the National Securities Commission, especially at a time when it is strapped for cash. So much so in fact, that it recently proposed the five SIFs to pay their fees for the first semester of 2010 in advance.

On Monday, the Rompetrol Group bought 1.37 billion RRC shares at 0.075 lei/share, through brokerage firm Eastern Securities, controlled by senator Verestoy Attila, who is also a shareholder of RRC. The price was superior to that of the tender offer (0.0741 lei).

Besides getting a better price for his shares, the senator also earned more from commissions, since fees for transactions conducted on the Deal market are higher than on those on the Regular market. Brokers say that the Rompetrol Group may have paid a fee of up to 0.3% of the value of the trades conducted through Eastern Securities, (745,436 lei or EUR 181,813 respectively). The officials of the brokerage firm declined to disclose the fee for the deal involving the 1.37 billion RRC shares sold through "Eastern Securities".

Also yesterday, the Rompetrol Group acquired an additional 1.93 billion RRC shares, through BRD Groupe Societe Generale, which also intermediates the public takeover offer.

The only seller that reported the sale of Rompetrol stock was SIF5 "Oltenia", which sold 0.46% of RRC, in exchange for 7.33 million lei.