To obtain financing, the Sovereign Fund for Development and Investment (FSDI) planned by the Government will sell shares in the state companies received in its portfolio, provided that it will preserve the majority stake, according to the memorandum approved on Thursday by the Government for initiating the procedures for establishing the fund.
In the same time, FSDI will issue bonds to finance its activity and the amounts borrowed this way will be paid with the „cash obtained from the investment activities they generate”, mentions the document.
The memorandum states that the sources of financing for the Sovereign Fund for Development and Investment (FSDI) planned by the Government will be:
- „financial instruments such as debt securities,
- dividends paid by the companies from its portfolio,
- revenues from fixed income securities,
- revenues from selling shares in companies where FSDI has holdings
- revenues from privatization.”
“The debt securities issued by the Fund will be backed by the assets from its patrimony” and „the payment of the bond interest and principal will be covered with the cash generated by its activities”, mentions the memorandum.
The Government is expected to approve an emergency ordinance for establishing the FSDI in April, which will also establish the shareholdings in the state companies from the Fund’s portfolio.
The actual establishment of the FSDI will take place after approving the articles of incorporation of the Fund, by a government decision, sometime in mid-July, according to the timetable set in the memorandum.
