Zamfirescu Racoti Predoiu Obtains A First-Time Award in Capital Market
Bucharest, November 25, 2011: Zamfirescu Racoti Predoiu Attorneys at Law (ZRP) has obtained an irrevocable solution in the trial in which it represented Grupul Industrial Voiculescu & Co (GRIVCO) against the shareholders who, by concerted action, exceeded the ceiling of 33% of the capital held in issuer Lacta Giurgiu, and which did not comply with the legal provisions for the launching of the mandatory purchase public offer, addressed to securities holders.
Thus, ZRP has obtained compensations in its client’s favor for the unfolding of the mandatory public offer on the shares of Lacta Giurgiu, issuer listed on Bucharest Stock Exchange, and instituted a precedent in Romanian jurisprudence in terms of operations carried on the capital market.
”Besides our client’s satisfaction, who managed to obtain the reparation of the damage caused, this award is welcome from the perspective of necessity to discipline the capital market. Moreover, we have proof that the courts of law from Romania understand and correctly enforce the laws applicable in this still insufficiently clear enough area generating numerous jurisprudence issues.”, said Cosmin Vasile, ZRP Partner.
Bucharest Tribunal obliged the opponent to pay a compensation equal to the price difference between the value of shares GRIVCO could obtain from their sale in the public takeover offer and the market value of the shares at the moment of lapsing of the two months when the companies that acted concertedly had the obligation to launch the sale public offer. Bucharest Court solution was maintained by Bucharest Court of Appeals and by The High Court of Cassation and Justice of Romania.
The court decision institutes a precedent in the matter of the relations between the shareholders of a company listed on Bucharest Stock Exchange and, practically, confirms the legislators’ intention to protect the majority shareholders who wish to withdraw, in the hypothesis in which another shareholder, alone or together with other person with whom it acts concertedly, exceeds the ceiling of 33% of the issuer’s shares.
ZRP team convinced the courts of law that, by the failure to observe the obligation to unfold the mandatory public purchase offer, it was impossible for the other shareholders to alienate the equity interest at the best price possible (and namely a price equal to the one paid by the offeror in the 12-month period prior to the offer). The irrevocable solution obtained attests that the shareholder that does not comply with this obligation exposes itself not only to the sanctions applied by CNVM, but also to civil liability, for the damages caused to the other shareholders.
The team of Zamfirescu Racoti Predoiu involved in the resolution of this file was made up of Cosmin Vasile, Partner of the Dispute Resolution Department, Monica Strîmbei, Senior Associate and Cosmin Cojocaru, Associate.