CITR Group launches ROCA – the first investment and management platform dedicated to Romanian businesses in distress

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Bucharest, March 6th, 2018The investment and management platform, ROCA, launched today by CITR Group, is the first investment platform dedicated to Romanian businesses in difficulty. ROCA aims at contributing to a healthy business environment in Romania, by providing a comprehensive solution to restore the health of local businesses: the platform draws resources from investors and efficiently distributes them to companies facing financial, growth or succession difficulties, in order to make sure they have a stable structure and a healthy development. CITR Group will ensure the management of ROCA. The founding shareholders are: CITR shareholders, through the investment division, Pavăl family, through PIF Industrial, Dan Șucu and Astra Rail Management GMBH.

ROCA: the solution connecting resources from investors and the entrepreneurs’ needs

Although Romania registered the highest economic growth in Europe, half of the local impactful companies are in a state of difficulty. Most of them are non-fundable or believed to be too insignificant for traditional investors. Under such circumstances, although the European market has sufficient liquidity, the investors fail to find opportunities to place these resources.  

Rudolf Vizental – CEO ROCA: “When it comes to companies in difficulty, the demand for funding does not naturally meet the investment offer. Therefore, we created the ROCA platform, aiming to provide the business environment with an integrated solution that enables a partnership between the investors’ resources and the entrepreneurs’ needs. What makes ROCA different is that we see opportunities where others see risks – many of the companies in difficulty present a huge untapped potential, and our expertise in managing crises and experience in scaling businesses create the perfect opportunity to develop solid companies together.” 

The ROCA platform is aimed at creating healthy companies that develop “made in Romania” brands, as well as at ensuring or rendering a national and international scale to these brands, by strengthening the respective companies’ capital structure. ROCA takes a share in both the risks and benefits and is actively involved in the recovery and growth of the companies. The platform is administered by the management division of the CITR Group. The decision to place the resources obtained from the investors belongs to the Investment Board, comprising representatives of the investors. The maximum funded amount is EUR 2 million/project. The percentage of ROCA’s contribution to the share capital of a company part of its portfolio is at least 60%, however a mechanism may be set out from the start that enables the entrepreneur to redeem the shares. The restructuring cycle of the companies within ROCA implies attracting resources for a period of 7 (+1) years, aiming at an annual rate of return (IRR) of at least 16%. Throughout the 7 (+1) period, the goal is to conclude two investment cycles, with profit achieved half-way (3.5 + 0.5 years), and the difference at the end.

Andrei Cionca – President CITR Group, co-founder ROCA: “In almost 20 years of experience when it comes to businesses in difficulty, I understood that the main challenge of the businesses left with no financial resources, yet with a potential to grow, is to regain credibility. That is why we created a solid partner to support and relaunch such businesses. Vision, stability, involvement and solutions – this is what ROCA brings for the companies in Romania.”

Currently, the ROCA shareholders are associates of CITR Group, through the investment division CIT Resources, Astra Rail Management GMBH, Pavăl family, through PIF Industrial, and Dan Șucu. The initiators of the projects are discussing with other key names in the field of local and international entrepreneurship to join the mission of this project.  

Dragoș Pavăl, investor in the ROCA platform: “We understood, in time, that we have other obligations towards our country, as well, in addition to paying taxes and abiding by the law. We also have the responsibility and the interest to do our best so that the economy in its entirety thrives. I believe that collaboration, cooperation between us, entrepreneurs, with a certain expertise in our respective business area, is what will drive change, whether through available financial resources, or knowledge on restructuring, or by discovering values within the companies that need support. That is why we joined, and we support the CITR Group initiative."

For investors, ROCA is an option to efficiently place high-yield financial resources, to have risk granularity, transparency when it comes to the evolution of the investments placed and a direct participation in the decision-making process.

Dan Șucu, investor in the ROCA platform: “I was drawn by the mission of this investment platform, ROCA, since the very first discussion, and its usefulness is undeniable. The success of this platform is rather difficult to achieve, but only experienced people such as Andrei or Rudolf can effectively undertake such a challenge. Furthermore, the participation of Paval family as shareholders, currently the most successful business people in Romania, is certainly beneficial. I personally have always managed my own funds. It is for the first time when I invest in someone else’s business and I do so because I believe in the success of this platform.”

The share capital of ROCA currently amounts to EUR 4.5 million, and the platform’s portfolio already includes S-Karp company, a Romanian shoemaker from Brasov. ROCA representatives intend to invest in five more companies by the end of the year and estimate that the platform will attract resources amounting to EUR 20 million by the end of 2019, funds which will mainly be assigned as working capital of the companies in the portfolio.

Romanian brands, ROCA’s mission

ROCA is addressed to Romanian companies which, despite being in a financial distress, provide products or services in a growing market, are able to generate operational profit and ensure a framework favorable to digitalization and export. The platform targets businesses that have the opportunity to grow organically and via consolidations with other companies with which there are complementarities or synergies.

The companies entering the ROCA platform benefit from an active business partner: a shareholder with a wide experience, not only a source of funding. ROCA consolidates the capital structure of the company and creates the framework to ensure it keeps the brand identity and vision.

Having the advantage of understanding the business and their identity, ROCA participates alongside the companies part of the platform in both the risks and the benefits of the business strategy developed together.

About ROCA

ROCA is an investment platform established at the initiative of CITR Group, with the support of the following investors: Astra Rail Management GMBH, Pavăl family, through PIF Industrial, and Dan Șucu. ROCA is addressed to Romanian businesses in financial, growth or succession difficulty. The platform is administered by CITR Group, through CIT Restructuring. The financial resources are attracted by the division CIT Resources. The initial share capital of ROCA is EUR 4.5 million, and the platform’s portfolio already includes the company S-Karp, shoemaker from Brașov. CITR Group estimates that the ROCA platform will attract resources of EUR 20 million by the end of 2019 and it will invest in five more companies by the end of 2018.  Visit the website for further details:  https://roca.business/ 

About CITR Group

CITR Group is the first group of companies in Romania specialized in customized remedies for companies in economic distress. CITR Group supports companies throughout their recovery process by providing reorganization, restructuring and investment solutions. The group has the resources to manage all business areas, both within and outside judicial proceedings. Established in 2014, its mission is to anticipate the needs of entrepreneurs and constantly improve the services offered to companies, so that any economic issue is transformed into a business opportunity. 

Three entities operate under the umbrella of the CITR Group: the investment division – CIT Resources, shareholder in ROCA, the management division – CIT Restructuring, which ensures the management of all companies of ROCA platform, and CITR, the insolvency division, a leader on the Romanian relevant market.