Magellan chair Hamish McLennan said the deal was an “excellent outcome for Magellan shareholders”. The market did not agree,with an investor sell-off pushing Magellan’s stock value down by more than 8 per cent to close at $15.80 per share.
“[Guzman y Gomez] is an outstanding company,however,the sale of our shareholding is consistent with our strategy to focus on our core funds management business,” McLennan said.
The investment was long-touted by Magellan’s chief investment officer Hamish Douglass as having enormous growth potential and was one of three direct investments held by Magellan Capital Partners (MCP).
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MCP oversees Magellan’s balance-sheet investments,including a 40 per cent stake in investment bank start-up Barrenjoey Capital,15 per cent stake in technology company FinClear and,until now,the stake in Guzman.
Magellan said the sale of Guzman was arranged by Barrenjoey Capital Partners with plans to seed an investment trust for high net worth investors. “We remain committed to the long-term success of Barrenjoey as a major shareholder,” McLennan said.
Last March,Guzman y Gomez delayed plans to list on the ASX after Douglass invested $86.8 million in the company,a significant stake that enabled the chain to refit its restaurants.