Cannon-Brookes’ Grok creeps on Tyro Payments

Sarah Thompson, Anthony Macdonald and Tim Boyd

Jan 26, 2021 – 9.34pm

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Mike Cannon-Brookes has reached into his deep pockets to help under-fire Tyro Payments overcome a short-seller attack.

It is understood Cannon-Brookes’ investment office Grok Ventures has had JPMorgan in the market acquiring Tyro shares in recent days, following a sharp sell-off at the hands of short-sellers and shareholders spooked by recent connectivity issues.

Tech billionaire Mike Cannon-Brookes’ Grok has owned a stake in Tyro Payments for more than five years. Sam Mooy

Grok’s buying is said to have been small at this stage; JPMorgan has accounted for 6.9 per cent of Tyro trade this year, according to Bloomberg data.

However, the fact it’s buying at all could warm the cockles of nervous investors at a time Tyro’s facing its first targeted attack as a listed company.

Of course Cannon-Brookes and his team at Grok know Tyro well.

The Atlassian co-founder bought into the then unlisted Tyro in 2015, as part of a funding round also involving Aussie fund manager TDM Growth Partners and America’s Tiger Global Management.

Grok opted to retain its Tyro stake at the company’s initial public offering in December 2019, and again when a voluntary escrow lapsed last year. Tiger and TDM have since sold down their holdings.

Grok owned 12.7 per cent of the company, or 63.3 million shares, as at July 31 last year, according to Tyro’s most recent annual report, while its most recent substantial shareholder notice was in December 2019 for 69.1 million shares or a 13.7 per cent stake.

Any buying worth more than about $20 million would need to be disclosed to the ASX via an updated substantial shareholder notice.

A Grok spokesperson confirmed some recent buying but declined to comment any further.

Grok’s buying comes as one of its fellow Tyro substantial shareholders, Fidelity International, is understood to have reduced its stake.

There’s been plenty of movement on Tyro’s register in the past fortnight, as investors reacted to the short attack and the company’s terminals outage which saw 30 per cent of its merchant customers impacted in early January.

The shorter, Viceroy, released a 14-page report that alleged about 50 per cent of Tyro’s payments terminals used in small businesses had been “bricked” by a service outage. Tyro rejected Viceroy’s claims. Its most recent announcement regarding the connectivity issue was on January 19, when it said 85 per cent of merchants had all of their terminals working.