Franklin Templeton International, the Fund Manager and Sole Director of Fondul Proprietatea, announces that after careful consideration, it has taken the decision not to participate in the ongoing selection process for the Fund’s Alternative Investment Fund Manager. The firm will therefore not submit a response to the request for proposal (RFP) to the selection advisor, Deutsche Numis.

Fondul Proprietatea was established in 2005 to compensate Romanian nationals whose properties were confiscated under the communist regime. Franklin Templeton was chosen to manage the Fund in 2009 following a competitive selection process and was formally approved as Fund Manager and Sole Director at a Fund shareholder meeting in September 2010.

Leveraging Franklin Templeton’s extensive investment expertise, the Fund was listed on the Bucharest Stock Exchange in January 2011 and on the Specialist Fund Market of the London Stock Exchange in April 2015.

Under Franklin Templeton’s leadership and stewardship over the last 14 years, Fondul Proprietatea has been a staunch advocate for minority shareholders’ rights, pushing for improved corporate governance, transparency, and accountability in state-owned enterprises (SOEs). These efforts have generated substantial value for the Fund’s shareholders and co-shareholders in the portfolio companies.

Key milestones and contributions to the Romanian economy and capital market include:

• Total shareholder return of 983% for the Fund’s shares and 313% for the Net Asset Value (NAV) in RON terms, and 634% and 184% in US$, respectively, since the Fund’s listing on the Bucharest Stock Exchange in January 2011 until 31 March 2024 . The US$ share price return has outperformed major global, regional and local indices, including but not limited to, the MSCI ACWI, S&P500, STOXX Europe 600, MSCI Emerging Markets and Bucharest Stock Exchange indices.
• US$1.5 billion of new foreign portfolio investment into Romania
• Close to 50 transactions totalling US$4.3bn, including the historic listing of Hidroelectrica S.A., the 3rd largest ever on a Central European Exchange, the largest ever in Romania and the largest IPO in Europe in 2023.
• Over US$7bn returned to shareholders of the Fund through dividends, returns of capital and share buy-backs.
• Increasing Romania’s visibility and viability as an investment destination with domestic and international shareholders through 6,200 meetings with institutional investors, 2,200 conference calls and more than 260 roadshows, investor day events and conferences.

“Franklin Templeton is immensely proud of the successes the Fund has achieved under our stewardship and the pivotal role it has played in the development of the Romanian capital market. The expertise, dedication, and resilience of our team in Bucharest have been instrumental in unlocking significant value for our stakeholders. While we will not be participating in the current selection process, we remain committed to the Fund’s continued success and exploring opportunities for the further development of the Romanian capital market,” said Johan Meyer, CEO of Franklin Templeton Romania and Portfolio Manager of Fondul Proprietatea.

Franklin Templeton remains committed to the management of the Fund. In addition, it will continue to support the development of the Romanian market and remains open to leveraging the experience and capabilities of its Bucharest team, backed by the wider organization.

Last but not least, Franklin Templeton extends its gratitude to all stakeholders, including shareholders in the Fund, the Government of Romania and other co-shareholders in portfolio companies, the Board of Nominees, the Bucharest Stock Exchange, the Financial Supervisory Authority, and various other contributors in Romania, for their continued support and collaboration.