Investors in the UK and Europe are particularly skeptical of Deliveroo, with data showing that only four of the continent’s 18,000 mutual funds have invested in the company delivering food from a disastrous initial public offering in March.
Deliveroo’s IPO is called worst in London history after its share price fell 26 percent at today’s opening. Two months on, shares are still trading more than a third below their 390p price list, closing Friday at 251p.
Investors spoke first on the IPO they said avoidance of the company due to concerns about the two types of list, management and work standards.
Based on data from Morningstar, the only fund available in the UK to disclose it has invested in Deliveroo managed by River and Mercantile for wealth manager AFH Group. The other three funds that will hold the stock are the Spain -based Enginyers Accions Europe fund and two European -dominated funds from Morgan Stanley and Franklin Templeton.
Morgan Stanley, Franklin Templeton, AFH Group, and River and Mercantile declined to comment. Caixa d’Enginyers did not respond to a request for comment.
Almost all of the mutual funds that support Deliveroo are in North America, along with funding from Fidelity, T Rowe Price and Federated Hermes, according to Morningstar.
Tom Powdrill, head of the management of Pirc, the UK’s proxy advisor, said that “the closer to the action – both in terms of the listing and where Deliveroo does most of its business – the less likely to invest “in The company based in London.
“If I’m a U.S. investor I think the lack of internal support for the stock is something to watch out for,” he added.
He said this was likely driven by the growing interest of European investors in environmental, social and governance issues.
Colin Baines, investment management manager at the Friends Provident Foundation, says the coronavirus outbreak brings with it societal issues such as working conditions. Having Deliveroo in portfolios is a sure way to flag clients that they may not be involved in social issues. [into investment decisions] that well. ”
Deliveroo said more than a third of its shareholdering comes from UK -based investors, including the British arms of international asset managers. Morningstar’s data covers 40,000 open-end funds worldwide, including 18,000 with domiciled in the UK and Europe.
Shares of other online food delivery companies, from Ocado to Just Eat Takeaway, have also not done very well in recent weeks, as investors fear losing the sector is now allowed to return. in restaurants.
But according to a recent report from Takealytic, a research component that tracks food apps, delivery “seems to be well established”, thanks in part to the launch activity.
Large institutional investors have also expressed concerns about Deliveroo’s double-class structure, giving Deliveroo co-founder Will Shu improved voting power. This split structure excluded it from the London premium listing, leaving some investors unable to buy the stock.
“We don’t have the power to do anything [because of the rights the chief executive will hold for three years]. The CEO can run the business however he wants for years, ”said Andrew Millington, head of UK equities at Aberdeen Standard Investments, prior to the IPO.
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