Today Argo Group announced that it would start a second share repurchase program. The first program, in which the company managed to buy back 28.1% of the outstanding share capital, was completed in July. In the second program the company is looking to spend £2.0 million, the same amount as in the previous program. With 48.4 million shares that remain outstanding and a share price that has been steadily moving upwards this year to 16.25p this would be enough money to retire another 12.3 million shares: 25% of the share capital and 50% of the float. We’ll have to see if the company will be successful in doing that. I was very surprised at the amount of shares they managed to buy in the previous program, so perhaps they can surprise me again. Since the stock is still trading at an almost 50% discount to NAV a successful repurchase program could increase intrinsic value materially.
Disclosure
Author is long Argo Group
No buybacks as of yet I see.
However, if media reports are to be believed AREOF appears to have some liquidity. By Argo capital I assume they mean AREOF, as this centre was something they owned in 2013. Now I wonder will management provide an update on this development, as presumably if part of the fund can afford this investment, they could also afford to repay some of the management fees owing to Argo !!
http://www.romania-insider.com/argo-capital-expands-commercial-center-iasi-eur-33-mln/
http://www.argocapitalproperty.com/media/documents/interim_accounts_31_03_13_1.pdf
Yeah, wonder where that money came from…
Yes, very interesting to see !
The Argo website seems to have had a fresh new makeover also. Perhaps a positive sign of business picking up, or perhaps a waste of shareholders cash ! We shall have to see.
Am quite surprised there have been no buy backs yet. Share price will likely move sideways until there is an announcement in that regard.
I note first buyback of 200k shares today @ 15.5p
http://www.londonstockexchange.com/exchange/news/market-news/market-news-detail/ARGO/13044867.html
Yes, good to see even though it was just a small trade.