Although it sounded like a joke only several months ago, the merger between the two Romanian capital markets was yesterday confirmed through a merger project for the Bucharest Stock Exchange (BSE) and the Electronic Market RASDAQ (BER).
Under pressure from CNVM (the National Securities Commission), the capital market watchdog, officials of the two markets managed to do in three weeks everything they had failed to achieve in six years - they finally agreed on establishing a sole market by yearend, a trading floor for the shares of all Romanian public companies.
The new market will have a total capitalisation worth some 5 billion euros, accounting for 11% of the Gross Domestic Product. The number of listed companies may reach 200, with almost 5,000 companies that can be traded. The current BSE capitalisation amounts to 2.7 billion euros, with 1.9 billion euros for RASDAQ.
The new entity, which market sources say will be called the Bucharest Bourse, will be structured as a joint-stock company, directly controlled by the brokerages.
Before the merger, the Bucharest Stock Exchange will stop being an association and will turn into a commercial company. The first step towards the capital market consolidation will be to move the RASDAQ staff into the BSE headquarters.
"We believe the merger could be completed in four to six months," said Sergiu Oprescu, BSE chairman. The BSE metamorphosis into a commercial company will trigger a series of legislation changes, which the CNVM officials mentioned last month. They now claim that the new law may be endorsed by this fall.
"CNVM supports the capital market defragmentation, which is necessary, given Romania's upcoming EU accession. The new capital market law, set to comply with the latest European directives, will most likely stipulate the Bourse's organisation as a joint-stock company. We wish to see the law endorsed by the beginning of the next parliamentary session at the latest," CNVM commissioner Gabriel Miclaus told Ziarul Financiar.
The legislation modifications that will ensue will target a harmonisation between Romanian laws and European standards, to grant EU intermediaries direct access to the Romanian market.
The future market will most certainly copy the current BSE structure: several tiers of listed companies and an alternative market, hosting those companies that do not meet the listing criteria.
vlad.nicolaescu@zf.ro
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