Global investment bank Babcock & Brown yesterday claimed a 15 per cent stake in Grand Hotel Group in a series of trades that drove the stock price up by as much as 25 per cent.
Almost a quarter of the company's shares changed hands. Three special parcels of shares, believed to have been traded through UBS, went through early yesterday.
That included one bundle - a 12.1 per cent stake, or about 27 million shares - that was offloaded by US-based Parker Global Strategies at 60¢. At least one other unidentified seller also pushed through large parcels of shares.
Last year, Parker Global Strategies joined with James Fielding Group in an effort to oust Grand Hotel's incumbent board members and reassign management responsibilities at the company, which owns a string of Hyatt hotels and the Country Comfort chain. Their bid failed.
The agitators claimed the company was being mismanaged and that the profit results and stock-price performance were poor. Recently, the shares have traded at a 50 per cent discount to the value of the company's net assets.
The two other large parcels - one lot of 5.9 million and another of 13.5 million - were sold in early trade at 67.5¢. It is believed a large parcel was acquired by fund manager Tricom.
The managing director of Grand Hotel Group, Garry Cameron, said the sale by PGS had prompted market speculation "and that's what's pushing a fair bit of trading in our stock".
He said he did not know who had bought up the substantial stakes in the company but said he believed that the largest shareholder, Tuan Sing, had retained holdings.
About 52.5 million of the 222 million Grand Hotel shares on the market changed hands, driving the price to a peak of 70¢ in intraday day. The stock closed at 67¢, up 11¢ on Wednesday's finish.
Babcock & Brown director Robert Topfer confirmed the 15 per cent stake had been acquired. In Australia, Babcock & Brown has a broad portfolio of investments including golf courses, property and a 19.9 per cent stake in retirement village developer Primelife.
But Mr Topfer said there were no plans to join with James Fielding Group to launch another tilt at control of the company.
Lee Iafrate, chairman of Armytage Private, which owns about 2 per cent of Grand Hotel Group, said that the company could face a shake-up under the ownership changes.