Hedge funds eye Endeavour Group

Woolworths moved to sell 5 per cent of Endeavour Group, which owns Dan Murphy’s, on Tuesday night. Picture: Aden Stokes

Based on the way the stock has traded since Woolworths sold its shares, it looks apparent that plenty of hedge funds have taken up stock in Endeavour Group.

But one investor that was not there as a buyer was the company’s greatest critic, Bruce Mathieson.

Mr Mathieson has his son, Bruce Mathieson Jnr, on the board, and is therefore prohibited from buying shares in the stock.

Endeavour’s shares are down from about $6.50 a year ago and 15 per cent shareholder Mathieson has criticised its management and performance and has been lobbying for change. Shares in Endeavour closed down 2c on Thursday to $5.13.

Some market observers believe that based on the way that the stock has been trading, hedge funds, which frequently buy and sell shares, had picked up the stock.

Endeavour operates pubs with slot machines and some investors are averse to buying such businesses because of ethical investing requirements.

Woolworths moved to sell 5 per cent of the company on Tuesday night, pocketing $486m for the trade handled by Jarden.

The 89.7 million shares were being offered at $5.22 each, a 2.6 per cent discount to their last traded price on April 30.

Woolworths was always expected over time to distance itself from the pubs operator and liquor store owner it spun off in 2021. Woolworths sold a 5.5 per cent stake in 2022 at $6.46 a share, leaving it with a 9.1 per cent stake in the business.

At the time of the demerger of Endeavour in 2021, Woolworths owned 14.6 per cent.