Representatives of Latvian banks with foreign capital who spoke with the LETA agency unanimously supported the swift listing of the municipal LLC Rīgas namu pārvaldnieks (RNP) - which manages about 3,500 buildings in Riga - on the stock exchange. Moreover, other municipal enterprises in Latvia could follow its example, according to economists working in commercial banks in Latvia.
Gints Beleviĉs, head of the financial markets department at one of the foreign-owned banks, noted in a conversation with LETA that transforming RNP into a joint-stock company and including its shares in the official stock exchange list would attract capital from institutional and private investors, as well as from employees and clients.
Beleviĉs pointed out that there could be demand for RNP shares since the company is profitable, operates in a stable business sector, has a broad portfolio of managed buildings, and a regular cash flow.
"Although the company cannot be expected to grow very rapidly, it could be attractive to both institutional and private investors who value a stable company with slow growth, predictable returns, and dividend payments," added Beleviĉs.
It is worth noting that in this case, the dividends paid to investors will be built into RNP's accounts and will be paid by ordinary residents.
The idea of listing RNP on the stock exchange was also welcomed by a representative of another foreign-owned bank, Dainis Gašpuitis. He noted that it would be a good signal, as the company would become more transparent and implement appropriate governance principles, from which, in his view, both its clients and the municipality would benefit.
Gašpuitis explained that the potential attractiveness of the company could only be determined after preparing an offer for investors. "It should be taken into account that interest will depend on how skillfully the work to attract potential investors is conducted. In general, other companies could follow in RNP's footsteps," he said, adding that more "heavyweight" issuers are needed to invigorate activity, but there is a lack of political consensus on their listing.
It was previously reported that the Riga City Council has prepared a draft decision providing for the sale of RNP, which is owned by the municipality; however, the acting mayor of Riga, Vice Mayor Edvards Ratnieks (NA), temporarily suspended the advancement of the project on Friday.
To ensure the sale of the company's shares as part of a public offering of securities, RNP plans to reorganize by transforming into a joint-stock company. Initially, it is planned to sell a controlling stake in RNP by announcing a public offering for 51% of the company's shares and including the shares in the official stock exchange list. Then, after the sale of the majority of shares, it is planned to sell the remaining equity stakes.
The real estate management company RNP is currently fully owned by the Riga City Council. Its turnover in 2024 amounted to €80.569 million — an increase of 8.55% compared to 2023, while the company's profit reached €9 million. RNP employs about 2,000 people and manages approximately 3,500 buildings.
