The tumble in Glanbia shares turned into a rout as the trading day progressed on Wednesday, with the equities ending the day almost 24% below where they closed on Tuesday. That’s bad news for Glanbia’s single largest shareholder, Tirlán Co-op.
The tumble in Glanbia shares turned into a rout as the trading day progressed on Wednesday, with the equities ending the day almost 24% below where they closed on Tuesday.
That’s bad news for Glanbia’s single largest shareholder, Tirlán Co-op.
With approximately 75.5m shares in Glanbia, Wednesday’s plunge to €11.20 a share means that the value of that holding fell by €261.2m in the last 24 hours.
It is also bad news for those members of Tirlán who voted in favour of the spinout of 15 million Glanbia shares in October last year.
At the time, they were told that the average value of the spinout per member would be €24,604. That valuation was based on the price of a Glanbia share at the time, which was €15.90.
Wednesday’s closing price was €11.20, which means the original average of €24,604 has now been reduced to €17,331.
Vote
The vote on the spinout also allowed for the establishment of an investment portfolio where Tirlán would reduce its shareholding of Glanbia and use to money to diversify its holdings and possibly engage in some corporate acquisition.
The total size of the investment fund was set to be 41.4 million shares valued at €658m at the time of the vote. Those 41.4 million shares ended Wednesday valued at €463.7m.
It is important to note that one day’s trading, however costly, will not translate directly into a loss for Tirlán or the members due to the spinout.
Shares could either rise or fall further between now and the May spinout date.
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