Why Voiculescu and Chelu are fighting over Lacta Giurgiu

Businessmen Dan Voiculescu and Catalin Chelu have begun powerful buying sprees on the Bucharest Stock Exchange (BVB) for the shares of Lacta Giurgiu (INEM), one of the few independent dairy producers on a market expected to exceed €2 billion in the coming three years (Business Standard).
Voiculescu, who owns a major media trust in Romania, acquired 18.16 percent of the dairy producer through his Grivco holding, while Scop Line Galati, supposedly controlled by Chelu, acquired a 32 percent stake of Lacta Giurgiu’s share capital. Contacted by Business Standard, INEM officials were unavailable for comment.

The main seller of INEM shares was SIF Oltenia (SIF5) financial investment company, which owned a majority share package of over 50 percent. Recent transfers of shares reduced the SIF’s participation to 11.62 percent. INEM shares were sold by SIF Oltenia to Grivco at an average price of RON 0.57/per share and for RON 0.54/per share to Scop Line Galati. The value of the transactions is similar to SIF5’s minimum asking price during the public sales offer in 2005. At that time, the company’s management was charging RON 0.9/per INEM share, although the value could drop to RON 0.5/per share following negotiations in the Dutch auction.

There has been significant movement on the dairy market in recent years, as several domestic dairy producers have been takeover targets of major companies. Two examples are the American SigmaBleyzer acquisition in 2008 of Covalact, and the French Lactalis takeover of LaDorna.