Yorgen Fenech arrest hits Tumas Investments bonds with heavy 7% drop

Investors react on stock exchange as Tumas Investments bond values drop, also affecting formerly related Tum Finance

Former Tumas Group director Yorgen Fenech
Former Tumas Group director Yorgen Fenech

Investors in Tumas Investments plc were quick to react to developments yesterday when board director Yorgen Fenech was intercepted by the Armed Forces out at sea leaving Portomaso in his luxury yacht, and arrested on suspicion of having masterminded the assassination of journalist Daphne Caruana Galizia.

Heavy trading was registered in bonds issued by Tumas Investments plc, with 69,900 bonds on a 5% coupon which mature in 2024 changing hands in two trades, without movement in price.

By 12pm on Thursday, there were six trades of 19,300 bonds, with price losing €7.29 for each €100 bond.

But the same could not be said for the longer dated bonds maturing in 2027 and giving a coupon of 3.75%. No less than 136,200 bonds changed hands in four trades with the closing price ending at par, losing no less than €7 per €100 bond.

The heavy drop of 7% in one day in one bond, was quite a unique event.

By 12pm on Thursday, there were eight trades of 54,900 bonds, with the price falling down to €99.97c and later recuperating to its €100 value.

The effects of Fenech’s arrest also battered another bond issue: the bond of Tum Finance plc, issued by relatives of Yorgen Fenech who no longer are part of the Tumas Group, suffered a drop in value.

A bond maturing in 2029 at a 3.75% coupon saw no less than 84,200 bonds in seven trades changing hands and on closing the price was slashed by €3.47 on €100.30. Tum finance plc is owned by Anthony Fenech, the uncle of Yorgen Fenech, who had divested his shares from the Tumas Group. Tum Finance plc board directors include the owner and his sons Silvan and Matthew, cousin of Yorgen.

Unsatisfied demand in this bond is bidding at below par at €99.

The Tumas Group filed regulatory papers announcing the resignation of director Yorgen Fenech the day before the scion’s arrest on Wednesday 20 November.

The rubber-stamped date of when the instruments were physically delivered to the Registry was Tuesday 19 November.

All instruments delivered to the Registry of Companies yesterday for the companies TumasGasan Operators, Tumas Energy, Tumas Gaming, Tumas Group Company, Tumas Group Finance, Tumas Group Management, and Tumas Investments plc, all indicated the effective date of change for the decision as of 12 November, 2019.

The instruments were marked as having been received at the Registry of Companies, on 19 November and finally processed on 20 November.