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Friday, November 12, 2004

Electromagnetica profit down 86%

source: Vanguard

The producer of domestic taps, agricultural tools and other metallurgic parts Armatura Cluj-Napoca wants to run an operation of increasing the share capital which could pass the control of the company from the employees’ ownership towards the Austrian company Hertz, which has a similar activity object. The Austrians have 20% of the company share capital that they bought in 2001 on the Stock Exchange. The Employees Association holds a stock of 40% of the shares, which allow them to control the company. The takeover of 20% coincided with the signing of some contracts. The increment will occur through capital contribution, up to ROL 76 bn (EUR 1.9 mil). The company’s shareholders will have the right to subscribe one new share for every one held at a price of ROL 5,000, as much as the face value. On the Stock Exchange, Armatura shares are traded around ROL 8,000. The shares remained unsubscribed according to the preemption right will be bought still by the shareholders, following the method “the first came the first served”, which means that Hertz will be entitled to buy the unsubscribed shares and will increase the stock. The Employees Association has still due installments from the privatization contract for the 40% shares held and it may not sell the stock of shares without the state’s consent. “PAS is also likely to subscribe in this increase, but we shall see how much we shall be able to subscribe. Hertz is interested in Armatura. If they come out with several million dollars, they will probably grow their participation. The purpose of the increase is that of bringing about money into the company”, Mircea Serbulescu, marketing manager of the company, commented. After employees and Hertz, the most important shareholders of Armatura are Transilvania Bank and Broadhurst investment fund, each of them holding 5% of the shares. The first nine months of the year meant for Armatura a sales and profit fall comparing to the past year. The turnover on nine months was ROL 167 billion (EUR 4.1 mil), by 6% lower in ROL terms and a profit of only ROL 455 mil, three times lower y/y. The market capitalization is EUR 2.9 million.

Posted by Mihai : 11/12/2004 02:47:00 pm