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Stock Commentary

Antonio Tiu raises stakes in Greenergy

Merkado Barkada
Antonio Tiu raises stakes in Greenergy

Just before yesterday’s close, Greenergy [GREEN 2.38 1.65%] disclosed that its owner, Antonio Tiu, had purchased 207,768,560 GREEN shares from Thomaslloyd Cleantech Infrastructure Fund GMBH (Cleantech), for a total price of P415,537,300 (P2.00/share).

The purchase raises Tiu’s personal stake in GREEN to 28.35%. The P2.00/share purchase price is a 16% discount to the price of GREEN at the time of the announcement and is well below any reasonable trailing average since GREEN has not traded below P2.00/share for almost a year.

The purchase also eliminates Cleantech as an investor in GREEN. This move comes after several smaller transactions where GREEN had been purchasing shares of AgriNurture [ANI 5.99 0.17%], another Tiu company, on the open market. Iris Gonzales reports that the moves are part of Tiu’s attempt to transform GREEN into a larger holdco of his various interests, including ANI; as part of that transformation, according to Gonzales, Tiu plans to “also infuse the fintech assets such as digital bank and the agri-token ecosystem.”

MB BOTTOM-LINE

That makes a lot more sense. It’s only natural for Tiu to try to own as much of GREEN as possible before the assets are eventually transferred and injected into the company. Think of GREEN like the bowl into which Tiu will place his most prized fruits. Gotta own that bowl. The Gonzales article also provides some context to GREEN’s recent drip purchases of ANI’s stock; if Tiu wants GREEN to be his holdco, he has to somehow up GREEN’s shareholdings in ANI. Before the flurry of open market buys, GREEN’s direct interest in ANI was only 9% as of ANI’s “Top 100 Shareholders” disclosure for June 30, 2021. As we reported yesterday, GREEN’s interest now stands at just over 19%. It will be interesting to see what Tiu does with the 24% stake he has in ANI through Earthright Holdings.

GREEN will need to own the majority of ANI’s common shares to consolidate ANI’s financials into GREEN’s own financial statements, so perhaps there could be a related-party transaction in the near future that sees Earthright Holdings sell its ANI stake to GREEN. Lots of possibilities, but again the point remains: what’s best for the GREEN shareholder or the ANI shareholder might not exactly align with what’s best for Tiu and his long-term vision.

I appreciate owners with plans and strategies, but I think it’s always important to re-evaluate how those plans/strategies are being implemented to make sure that your investment isn’t in line to get the short end of the valuation stick.

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