The Cabinet approved the signing of a pre-contract for the purchase of newly issued shares in Moldova Agroindbank with an international consortium of investors, IPN reports.

On June 19, 2018, the Executive Board of the National Bank of Moldova (NBM) approved the acquisition by an international consortium of investors of 41.09 percent stake in the share capital of the commercial bank Moldova Agroindbank SA.

The consortium includes the European Bank for Reconstruction and Development (EBRD), Horizon Capital, a private equity and venture capital firm managing through the Emerging Europe Growth Fund III the investments of reputable international financial institutions such as the Western NIS Enterprise Fund (founded by the US Treasury through USAID), the EBRD, the International Finance Corporation (World Bank Group), the Dutch Development Bank, the German Investment Company and the French Development Agency (PROPARCO), and Invalda INVL, a listed investment firm from Lithuania, specializing in financial and banking markets.

Ina a press release, the National Bank of Moldova provided details about the members of the international consortium of investors.

The European Bank for Reconstruction and Development is a multilateral development bank founded under an international treaty that promotes the development of private sector and entrepreneurial initiative in 38 countries of the Central and Eastern European and the Mediterranean region. EBRD is one of the largest institutional investors in the Republic of Moldova with total investments of over €1.3 billion in 120 projects and an investment volume of €130 million recorded in 2017.

Horizon Capital is an investment equity firm with 25 years of experience, operating mainly in the countries of Eastern Europe, including the Republic of Moldova. It is supported by over 40 institutional investors, managing four investment funds with total assets of about USD 700 million. Horizon Capital implements projects and manages investments in the banking sector in the region.

Invalda INVL is a Lithuanian investment firm, one of the most important asset management groups in the Baltic region, listed on the Nasdaq Baltic Stock Exchange in Vilnius. The Invalda Group companies manage assets of over €600 million, including significant assets in the financial and banking sector.

The consortium intends to carry out the proposed acquisition through an investment firm, specifically created for this purpose - HEIM PARTNERS Ltd., registered in the United Kingdom with headquarters in London.

Prime Minister Pavel Filip said the decision to sign the pre-contract with the international consortium of investors is very important given that one of the major objectives of the Government is to stabilize the banking system. Thus, in cooperation with the International Monetary Fund and the European Union, extensive reforms were done to ensure transparency and to strengthen the licensed banks. “We expect this transaction will be successful and with the expected effects,” stated the Premier.

According to the bill authors, the Government’s decision to purchase and later sell the newly issued shares of Moldova Agroindbank will contribute to ensuring the stability of this bank, will help improve corporate governance, will offer the necessary protection to potential investors and will further stimulate the reformation of the banking system.

Moldova-Agroindbank SA is a systemic bank. Given that more than three months have expired since the exposure for sale on the regulated market of the package of the bank’s new shares issued under the decision of the MAIB’s Executive body, due to the cancellation of the undisposed shares of the former shareholders, the National Comittee for Financial Stability submitted to the Government a proposal to initiate negotiations with potential acquirers on the sale of these shares. The law provides that the Government can hold the shares for at most 90 days.

In the event that a pre-contract with the international consortium is signed and the buy-sell procedure is initiated under the law, the tender will be opened under equal conditions for all potential acquirers that received the NBM’s prior permission.

The aforementioned procedure does not affect the bank’s activity.