The Romanian-American Investment Fund consolidated its position in the investment management industry by acquiring the brokerage firm Intercapital Invest. The investment management industry grossed about $43 mil last year and I believe it is one of the most attractive industries to go into nowadays in Romania. Even though in the past there were some problems with the late SAFI and FNI which gave a bit of a bad reputation, this can be overtaken by a good portfolio manager/good portfolio performance and the right market positioning. Actually these are the keys for a tremenduos growth in the future.
What are the products? I think mutual funds present a bit of an interest, serving all types of risk appetites. At the same time hedge funds are not to be underestimated - actually MAN is already present in Romania targeting the High Net Worth Individuals (HNWI) - a segment that seems to have grown in the last years in Romania. Also, more private equity placements are expected to appear, as foreign investors eyes were caught by Romanian potential in the light of EU accession. Finally, the real estate remains one of the favourite investment areas in Romania, there's lots of new office buildings built in Bucharest lately and this only means flourishing business.
What is the market? The savers first of all, used only to save foreign currency either depositing in banks or keeping cash. Good marketing and smart branding are more than necessary for making the switching costs appear not as high or risky as they seem to be (due the the lack of market education.) This and a good communication strategy will win small investors confidence. Secondly, the newly-emerged HNWI will also be interested in attractive returns, perhaps in more sophisticated products such as the hedge funds. Finally the institutional investors segment which still seems to be in a strong inertia, the industry definitely needs the big private pension funds active role.
On the sell side the market certainly seems to heat up with the M&A predicted to grow from $400mil in 2001 up to $1bn in the following years - this means more business for investment bankers as well. There are a few fragmented industries with growth potential worth a look at - my takes are banking industry (Tiriac Bank is for sale, Banca Romaneasca is already sold), tellecommunications (consolidating segments predicted to grow with few big players and several small emerging ones fighting for the pie - Astral and RDS, Connex and Orange) or retail (there's been a tremendous growth of the retail chains lately)
