Romgaz lists in London and Bucharest in largest ever Romanian IPO

Romania’s largest natural gas producer and supplier, which is majority state-owned, has listed in London and Romania in the country’s biggest IPO to date.

Sixty-four percent of the offering is made up of shares listed on the Bucharest Stock Exchange (BSE), with the remainder coming from global DRs (GDRs) listed on the London Stock Exchange under the SNGR ticker.

The company raised 1.7 bn lei ($511 mn) in the flotation, according to Reuters, which valued Romgaz at around $4 bn. Shares on the BSE opened at 35.85 lei on Tuesday, almost 20 percent above the offering price agreed with international lenders. In London, Romgaz GDRs opened at $10.80.

The sale of the 15 percent stake in Romgaz, which is responsible for 50.1 percent of Romania’s domestic gas production, is part of wider privatization plans between Romania and the International Monetary Fund (IMF) under a two-year aid package for the EU’s second-poorest country.

‘This is a significant milestone in Romgaz’s strategy to become a regional leader in energy exploration, production and supply,’ says Virgil Marius Metea, CEO of Romgaz, in a press statement from BNY Mellon, which has been appointed as the depositary bank for the company’s GDR program. ‘Our IPO received high-quality institutional demand from all regions in which the securities were offered. The successful pricing of our offering is a clear endorsement of the Romgaz investment case and reflects the strength of investor appetite for the Romanian gas growth story.’

Other Romanian company sales agreed with the IMF include stakes in power distributor Electrica, hydro-power producer Hidroelectrica and coal-fired power firm Oltenia.

‘We hope this will provide a template for other Romanian companies looking to raise capital,’ adds Christopher Kearns, CEO of BNY Mellon’s DR business.