Romanian Owned Black Sea Glbl Prp Offer EUR37.8M To Overtake Fabian Romania

Currently, BSGP is the beneficial owner of 12,796,054 Fabian Romania shares, or approximately 25.2% of the company’s share capital.

BSGP and the independent directors of Fabian Romania said Friday they have reached agreement on the terms of a recommended cash offer for Fabian Romania which values it at EUR50.8 million.

The offer is being made at EUR1 in cash for each Fabian Romania share and represents a premium of 93.2% over the closing price of a Fabian Romania share of EUR0.5175 at Dec. 18.

BSGP is a company incorporated in the British Virgin Islands for the specific purpose of making the offer and is a wholly-owned subsidiary company of Rompetrol Holding (RPH), owned by oil tycoon Dinu Patriciu, founder of Rompetrol, the second largest oil group in Romania.

"I believe that our offer represents a full and fair price for Fabian Romania and I am delighted that we have the complete support of the Company’s Board. Our cash offer provides certainty to Fabian Romania shareholders during a period of significant economic turmoil and as the price of real estate assets in Romania continues to fall,” Patriciu said in a press release.

Professional services firm, PricewaterhouseCoopers was BSGP’s financial adviser on the offer, while financial adviser Lazard & Co. Limited acted for Fabian Romania in connection with the offer.

"The offer from BSGP provides Fabian Romania shareholders with an exit, in the face of a downturn in the Romanian property market, on terms which reflect the very substantial achievements the company has made to date," Jaroslav Kinach, Chairman of Fabian Romania said.

According to Fabian’s announcement, Rompetrol Holding has a significant interest in, and experience of, real estate in the Black Sea region. "It has been its intention for some time to create a real estate investment vehicle through which it could continue to invest in and develop high quality property assets in Romania."

"Our investment in Fabian Romania allows us to fulfil my long held ambition to create a platform on which we can build a property company that will acquire and develop assets in Romania," Patriciu said.

In spite of the current global economic crisis, RPH believes that real estate in emerging markets remains attractive for investors with liquidity in those markets as well as the relevant management expertise.

"Together with his brother, Dinu Patriciu identified and completed the acquisition and development of the first sites in Romania for large retail chains, including Billa and Minimax. Mr. Patriciu currently remains an active investor in the Romanian property market, where he is fully involved in the development of, together with Immorent AG, a 150,000 sq m office and residential project in the north of Bucharest, known as «Smart City»," the announcement said.

If the Offer succeeds, RPH would wish to retain Fabian Capital Limited as Fabian Romania’s investment manager, and JTC Management Limited as Fabian Romania’s administrator and manager, and, subject to regulatory approval, also retain Fabian Romania’s AIM and Bermuda Stock Exchange listings.

Under Romanian merger control rules, the Romanian Competition Council must be notified of the Offer.