Fondul Proprietatea, one of the largest closed end funds in the world, is becoming interesting. In the last few days Romanian index and Fondul are down 5%.
The reason for the sell off is Romanian bank shares. The sell off was caused by speculations of new asset tax on banks to be imposed by Romanian government. It may be a buying opportunity to get back/increase exposure in Fondul.
Fondul trades at 31% discount to its NAV. The reason for such steep discount is in high proportion of unlisted assets in its portfolio.
Over the last years FP was selling one non-listed asset per year. This year they may be selling half of unlised NAV:
– sale process for the two electricity distribution companies is under way (19% of NAV)
– Salt mine is in sale process (2% of NAV)
– Fondu appointed advisors for the disposal of Hidroelectrica stake (33% of NAV)
– Salt mine is in sale process (2% of NAV)
– Fondu appointed advisors for the disposal of Hidroelectrica stake (33% of NAV)
Unlisted assets now represent 69% of total assets. If the disposals would materialize, unlisted assets would decrease to 15% only while cash would represent over 55% of total assets. The price would sky rocket.
For more information on the opportunity pls go to:
Fit Investment Ideas 