Bailouts are not for shareholders: Munro Partners

April 15, 2020

Shareholders should not expect to see a share price recovery if companies receive a bailout because of COVID-19, Munro Partners believes.

Munro’s chief investment officer, Nick Griffin, said. several Australian and New Zealand companies such as Virgin Australia, Kathmandu and Ooh! Media had been forced to go to seek a bailout after the businesses were hit.

“They are tapping the market because they need equity which is putting pressure on the equity market and sucks up capital,” Griffin said.

“The important thing to remember as a shareholder is that we are the last people anyone is thinking about. The bailout is there to save jobs, to save businesses, it is not there to save the shareholders.

“Shareholders are not the problem, this is a health crisis, this is a solvency crisis and shareholders will have to pay their bit.”

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