Stock Update
Australia

TPG Telecom (formerly TPM, now TPG)

1 Jul 2020
By
Members bought into TPG Telecom on 15 June as part of the Momentum Strategy, and the stock has been in the final stages before the company-transforming merger with Vodafone.

Members bought TPG Telecom around $8.20 and the stock has enjoyed a strong run until today, which also marks the first day TPG Telecom trades as the merged TPG/Vodafone entity.

As members held TPG Telecom yesterday (under the code TPM), the holding will be different today and comes with a few extras. As of today, TPG Telecom now trades under the code TPG and members own 1 of these shares for every 1 TPM held. Additionally, TPM shareholders will receive a $0.49 fully franked dividend (plus $0.21 in franking credits) and also 1 new share in Tuas Ltd (TUA) for every 2 TPM shares held as of yesterday. TUA is TPG Telecom’s Singapore business which it has spun out to existing shareholders and will not be part of the new merged entity.

TPG opened trading today on a deferred basis – normal trading begins on 14 July at which time liquidity should improve – at a price of $9.70 before dropping to just over $9.00 at the time of writing. Additionally, TUA began trading at a price of $0.69 which is worth an extra $0.35 to members. When combined, today’s value is $9.00 (the new TPG shares) plus a $0.70 gross dividend plus $0.35 (in TUA shares), which is a total of $10.05 which is a 22.6% more than our entry price.

TPG will remain in the Momentum Strategy until at least the middle of this month but given the early strength we’ve enjoyed it looks likely that we will stay in the stock for now.

Rivkin does not ever provide financial advice. Please consider your own circumstances before purchasing any of our products or acting on our general advice, for any Rivkin product or recommendation.

SHOW COMMENTS / QUESTIONS (2)

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Comments

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Peter W.

What do we do with the TUA shares?

Shannon Rivkin

Hi Peter,

Right now the liquidity of the shares isn’t great while it trades on a deferred basis, so once it trades on a normal basis we will look to exit.

Regards,
Shannon

We are glad you liked it

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