9th Jan 2020 12:08
(Alliance News) - Zegona Communications PLC on Thursday said Aberforth Partners LLP took a 6.1% stake in the investment company amid strong momentum in Zegona shares.
The stock was trading 1.5% higher in London in midday trade at 115.75 pence a share.
"Since early December, when we highlighted the 46% difference between our share price and the underlying asset value per share, we have seen strong momentum in our shares, with Aberforth and other high quality investors making large new investments," said Zegona Chief Executive & Chair.
On Tuesday, Zegona launched a share buyback programme for up to GBP10 million to increase its underlying asset value per share.
Zegona's principal asset is its ownership of telecommunications provider Euskaltel, where it is the largest shareholder, owning more than 20%.
Zegona explained that it has been "influential" in driving changes within Euskaltel, leading to Euskaltel expanding nationally into the 85% of the Spanish market where it was not yet present.
Euskaltel's share price has responded positively and has increased by 21% between June and December 2019, when Zegona reported that its stake in Euskaltel and net cash position had a value of GBP1.41 per Zegona share, which was 46% higher than Zegona's share price.
Since then, Zegona's share price has increased 14%, the company noted, and "high quality" investors have made "significant" new investments.
Zegona said it was determined to take actions to close the difference between its share price and net asset value.
By Evelina Grecenko; [email protected]
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