US hedge fund Glenview Capital rebuilds Punch Taverns stake

Date: Monday, July 26, 2010
Author: Amy Wilson, Telegraph

The fund, led by Larry Robbins, increased its voting rights to 13pc, comprised of 2pc in shares and 11pc in financial instruments. Glenview raised its interest above 10pc last Friday.
The hedge fund acquired 17pc of the voting rights in June 2009, when Punch's shares were trading at around 155p. The company then reduced its interest to 8pc by December 2009, when the shares were down at 65p. Glenview has gradually raised its stake during 2010.

Another large hedge fund, GLG, has also raised its stake in Punch above 3pc.

It is thought that investors are attracted to Punch's shares as a proxy for backing rising UK consumer confidence. Figures showed the economy grew at twice the pace predicted by economists in the past three months, with GDP rising 1.1pc. Services and construction drove growth.

Punch shares rose as much as 4pc yesterday, and closed up 0.85. or 1.1pc, at 74.35p. The shares rose 3.3p on Thursday.

The group's investors have undergone a torrid ride since the start of the financial crisis, with the shares peaking at £13 in May 2007, before plunging to a low of 31p in January 2009.

Analysts said the shares remain volatile because of Punch's relatively high net debt.