Auerbach Grauson exits Lion Brewery

• Transaction carried out below market price
• Norges Bank believed to be main buyer

Auerbach Grauson & Co., a brokerage that specialises in international trading, exited Lion Brewery (Ceylon) PLC (LION) yesterday by divesting its full shareholding below the market price, which appeared to be a negotiated deal. 

As the 8th single largest shareholder of LION, Averbach Grauson held 884, 945 shares or 1.11 percent stake as at June 30, 2020. 

The market yesterday saw the exact quantity held by Averbach Grauson changing hands in 21 market trades, largest being 626,774 shares, at Rs.520 each, down by Rs.40.3 or 7.2 percent of the previous close.

The main buyer of the shares is believed to be Norway’s central bank, Norges Bank. Net foreign sales at LION amounted to Rs.134.3 million.

The 21 trades generated a turnover of Rs.460.2 million. LION share closed at Rs.520 yesterday. 

LION’s net asset per share was Rs.190.19 as at June 30, 2019, little up from Rs.189.28 three months ago.
Market analysts said the transaction didn’t take place as crossings because crossings cannot be executed more than 5 percent below previous close.

For the quarter ended June 30, 2020, LION, the country’s largest brewer, saw its earnings tumbling by 91 percent year-on-year (YoY) to Rs.72.5 million as group revenue fell 45 percent YoY to Rs.6.4 billion amid COVID-19 lockdowns and resultant economic slowdown.