The improving outlook for the Greek economy, coupled with a return of buying interest from Greek and foreign investors, as well as the lack of depth of the Greek stock market, suggests epic battles in the stock market. The cases of MIG and Bank of Attica, which have more than quadrupled in market value over the past few months, to levels that are in no way in line with their fundamentals, are usually such examples, but also heralds of possibly similar developments in other companies. . and also which will become the center of investment interest. Aggressive takeover attempts, as they often do overseas, are also expected to spread.

This is explained by “K” in stock market and business circles, pointing out that such phenomena can even “spoil jobs.” And they cite as recent examples the risk of discouraging strategic investors from an increase in the capital of the Bank of Attica or the possible disruption of the Anonymous Crete Shipping Company’s consolidation plan. In the case of Attica Bank, the fact that the share price more than quintupled in two months from €0.06 in early December to €0.32 a week ago, while the bank has a negative net position, is cited as a possible deterrent. factor. for investors who want to participate in increasing its capital. And this is because many are asking the question “if now, when the free float is only 1.9%, there are such phenomena, what will be in the future on the path to consolidation?”.

In the case of MIG, for control over which Piraeus Bank and the interests of the M. Iliopoulos group compete, the stake is on a smooth path to the takeover of ANEC by the Attica group and the creation of one of the largest international shipping groups. In this case, the share jumped from 0.04 euros to 0.23 euros. “However, this conflict of interest, when carried out with clear rules and transparency, is a building block of the free market,” remind the beggars.

Thus, at this stage, questions arise as to whether shares with very low dispersion (free float) and therefore easily manipulated should remain listed, and when the supervisory authorities, the Capital Market Commission and the Athens Stock Exchange, too should intervene. And that’s because this behavior is expected to increase. Whether it be companies in need of consolidation, or companies whose shareholders are in conflict, or finally companies where the prospect of corporate transformation creates capital appreciation expectations. It is worth noting that the value of transactions in January on the AHA, where GD exceeded 1,000 units over the years, reached 1.930 billion, up 67.42% from December.

The lack of depth of the Greek stock market suggests epic battles in the stock market.

What do market watchers say about all this? “The services of the Capital Market Commission monitor and investigate cases of significant corporate events and large fluctuations in the price of shares in order to identify and evaluate any signs of market abuse, manipulation or use of confidential information,” sources at the Commission explain. to “K”.

“In the case of Attica Bank, this monitoring started back in January when the stock price fluctuated,” they add, pointing out that “by definition, stocks with a small variance are especially sensitive to both price and volume volatility.” In cases where such a phenomenon becomes more intense, the Commission follows certain procedures, as was the case with Attica Bank. “He immediately took additional steps to identify the transactions and those involved in them, and at the same time, the Bank of Attica asked to be informed if there were any events that were not known. In any case, the Commission acts on the basis of current legislation and European and international practice, especially with regard to decisions to suspend negotiations,” they state. “As for the issue of dispersion, we have already identified the problem and are already negotiating with A.A. changes in the Regulations in these cases,” the same sources tell K.

Other Commission sources with twenty years of experience in the AXA Regulation recall that until 2017 there was a special category of low dispersion, which included companies with a dispersion of less than 15% or 10% after corporate transactions. “In addition to marking and reporting to the market, low-spread trading was carried out by a special auction method, in which the price is finally determined after exchange members already know the estimated price and trading volume,” the message says. explain. Because of the wild or otherwise “irregular” fluctuations of stocks traded with very low variance, “maybe it’s time to consider restoring this special category or adopting some other regulatory way of dealing with irrational phenomena in the price formation mechanism in stocks. which have low variance and marketability given the typology of market abuse,” these sources suggest.

Hard poker for the future of Attica Group

A clash between MIG’s two largest shareholders, who have different strategies for the future of MIG’s subsidiary, the shipping company Attica Group, sent the share price down from a 12-month low of EUR 0.0217 to EUR 0.2350. This is a 1082% increase or a tenfold increase in the market value of MIG, which is saddled with debts of more than 400 million but owns a statutory majority of Greek shipping. With Piraeus as the majority shareholder, MIG management negotiated with its creditor Strix a few months ago to swap his $443 million stake in Attica Group (79.38%), with a debt of $443 million. Thus, Strix will become the owner of more than 90% of the shares of Attica (it already owns 12%). However, the Attica Group’s main competitor, Mario Iliopoulos, which controls Seajets, is trying to prevent the conclusion of the corresponding agreement by acquiring more than 5% of MIG’s shares.

Piraeus responded by increasing its stake from 32% to levels above 33%, making sure to put forward a public offer to acquire the remaining shares at the same time. Both parties have continued and appear to continue to buy MIG shares, with Piraeus reaching 53.5021% and Iliopoulos 10.69%. Buying at consistently higher prices has already driven up the public offering price and is likely to bring even more as both sides try to control much of MIG’s March 3 general meeting.

“Rise” and suspicions of manipulation

While the Bank of Greece, the Financial Stability Fund and the management of the Bank of Attica are trying to fix the situation of the bank by increasing capital by $490 million and attracting a strategic investor for this purpose, a number of currently unknown investors have brought the bank’s stock market valuation close to $500 million .USA.

Growth from twelve-month lows to highs of the order of 500%. A correction to the level of 300 million followed, but given that the shares in free float correspond to only 1.9%, the market was swamped with suspicions of manipulation of the shares. Motivation manipulations said in the market were either to extract value above the actual value due to the bank’s possible exit from the stock exchange, or to prevent Thrivest, which controls Pancreatia, from participating in a capital increase or to protect the interests of existing shareholders.

The Bank of Greece, having identified the risk that after Ellington Thrivest would also leave the table, has reportedly taken the initiative to decouple the capital increase and related shareholder agreements from the market value of the shares. And that’s because the Bank of Greece is trying to form a 5th banking pole to further promote competition while consolidating smaller banks. However, the question “why trading in shares was not suspended” was and continues to be acutely asked by many market participants who fear similar phenomena in the future. Sources with intimate knowledge of the exchange’s rules explain to K that “the suspension of trading is an international market protection measure, which is mainly imposed by managers (exchanges), while supervisory authorities maintain parallel competencies.

It does not necessarily combine practice, but refers to a specific situation, emergency and temporary.” “Trading is suspended when the orderly functioning of the market and the interests of investors are threatened. Indicative reasons for the suspension are the lack of information and the risk of deceiving the population, which cannot be excluded by unfair interference in the pricing mechanism,” the company notes. They add that “the suspension is decided each time after evaluation, based on each incident and special circumstances.”

Shareholder feuds and the arrival of the “white knight”

Confrontation between minority shareholder Lukas Spenzaris and the Lappa family in I. Klukinas – I. Lappas has paved the way for Intracom Holdings to acquire a significant real estate portfolio, which it will “endow” to the newly formed real estate company Intracom Properties, while at the same time providing itself with the means by which it will be listed on the Athens Stock Exchange. At the same time, the shares doubled in price.
This is a classic case of a takeover that defused the time bomb of a conflict between two shareholders and at the same time created a profit for minority shareholders. On February 2, the sale of 27.61% of Klukin-Lapp by Lukas Spenzaris to Intracom Holdings was announced at a price of about 9.99 million euros. It was also announced that a binding memorandum had been signed with the Lappa family for the sale of 46.6% for 18.74 million euros.

The deal with the Lappa family is expected to close in the coming months, and once completed, Intracom Holdings, which will now control 74.21% of the company, will have to go public. The above events have lifted shares from a 12-month low of €0.46 to above €0.94 in recent days. The first clouds in Klukinas-Lappas appeared at the end of 2019, when L. Spendzaris stepped down as Vice President and Managing Director.

Then the real reasons for the resignation became known. An open conflict with the Lapp family occurred in June 2021 at a general meeting, when L. Spendzaris raised a number of questions about the work and management of the company. A few months later, the dispute was taken to court. The “relief” comes from an agreement with Intracom Holdings to use Klyukina-Lapp’s property, which it is transferring to its new subsidiary, Intracom Properties. Mothercare and the hydroelectric plant will be taken over by other companies.