Private companies own 28% of TPG Telecom Limited (ASX:TPG) shares but public companies control 35% of the company

Key Insights

• The considerable ownership by public companies in TPG Telecom indicates that they collectively have a greater say in management and business strategy
• 52% of the business is held by the top 3 shareholders
• 10% of TPG Telecom is held by insiders

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To get a sense of who is truly in control of TPG Telecom Limited (ASX:TPG), it is important to understand the ownership structure of the business. The group holding the most number of shares in the company, around 35% to be precise, is public companies. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

Meanwhile, private companies make up 28% of the company’s shareholders.

Let's delve deeper into each type of owner of TPG Telecom, beginning with the chart below.

View our latest analysis for TPG Telecom

What Does The Institutional Ownership Tell Us About TPG Telecom?

Many institutions measure their performance against an index that approximates the local market. So they usually pay more attention to companies that are included in major indices.

We can see that TPG Telecom does have institutional investors; and they hold a good portion of the company's stock. This suggests some credibility amongst professional investors. But we can't rely on that fact alone since institutions make bad investments sometimes, just like everyone does. If multiple institutions change their view on a stock at the same time, you could see the share price drop fast. It's therefore worth looking at TPG Telecom's earnings history below. Of course, the future is what really matters.

We note that hedge funds don't have a meaningful investment in TPG Telecom. Vodafone Hutchison (Australia) Holdings Limited is currently the largest shareholder, with 28% of shares outstanding. WHSP Holdings Limited is the second largest shareholder owning 13% of common stock, and Vodafone Group Public Limited Company holds about 11% of the company stock.

A more detailed study of the shareholder registry showed us that 3 of the top shareholders have a considerable amount of ownership in the company, via their 52% stake.

While studying institutional ownership for a company can add value to your research, it is also a good practice to research analyst recommendations to get a deeper understand of a stock's expected performance. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.

Insider Ownership Of TPG Telecom

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. The company management answer to the board and the latter should represent the interests of shareholders. Notably, sometimes top-level managers are on the board themselves.

Most consider insider ownership a positive because it can indicate the board is well aligned with other shareholders. However, on some occasions too much power is concentrated within this group.

Our information suggests that insiders maintain a significant holding in TPG Telecom Limited. It is very interesting to see that insiders have a meaningful AU$1.0b stake in this AU$10b business. Most would say this shows a good degree of alignment with shareholders, especially in a company of this size. You can click here to see if those insiders have been buying or selling.

General Public Ownership

The general public, who are usually individual investors, hold a 19% stake in TPG Telecom. While this size of ownership may not be enough to sway a policy decision in their favour, they can still make a collective impact on company policies.

Private Company Ownership

It seems that Private Companies own 28%, of the TPG Telecom stock. It might be worth looking deeper into this. If related parties, such as insiders, have an interest in one of these private companies, that should be disclosed in the annual report. Private companies may also have a strategic interest in the company.

Public Company Ownership

Public companies currently own 35% of TPG Telecom stock. We can't be certain but it is quite possible this is a strategic stake. The businesses may be similar, or work together.

Next Steps:

I find it very interesting to look at who exactly owns a company. But to truly gain insight, we need to consider other information, too. To that end, you should be aware of the 1 warning sign we've spotted with TPG Telecom .

If you would prefer discover what analysts are predicting in terms of future growth, do not miss this free report on analyst forecasts.

NB: Figures in this article are calculated using data from the last twelve months, which refer to the 12-month period ending on the last date of the month the financial statement is dated. This may not be consistent with full year annual report figures.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.