The All Ordinaries Index (ASX: XAO) is down 0.3% on Monday, but that's not stopping investors from bidding up ASX All Ords financial stock GQG Partners Inc (ASX: GQG).
After sailing into some rough waters over the past month, the GQG share price is up 3.9% in morning trade on Monday at $2.16 a share.
As for those rough water, the GQG Partners share price remains down 22.9% since this time last month. Long term, shares in the United States-based fund manager are up 44.0% over 12 months.
The ASX All Ords stock is in the green today after announcing it was cancelling its recently announced share buyback.
ASX All Ords stock gains on $100 million buyback axing
On 22 November, GQG Partners reported its intention to buyback up to AU$100 million of CHESS Depositary Instruments (CDIs) of its common stock.
If you're unfamiliar with the term, CDIs enable non-Aussie companies to list on the ASX and trade their shares like any other Australian company.
The share buyback announcement followed the 19.3% share price the ASX All Ords stock suffered the previous day, 21 November.
That horror day of trade was driven by news that United States prosecutors had charged Gautam Adani, chair of Indian conglomerate Adani Group, over a multi-billion dollar bribery and fraud scheme. Investors rushed for their sell buttons, as GQG Partners has made significant investments in Adani.
The board noted that, "The on-market buy-back recognizes the significant market volatility at present and will allow GQG to opportunistically and flexibly acquire CDIs."
CEO Tim Carver said on the day, "We believe our stock is undervalued and this is a great investment opportunity. We have a strong balance sheet and GQG believes in the strength of its business. We're happy to buy our stock at these values."
But it appears that opaque US tax laws have derailed the buyback, with management citing "a lack of certainty as to the US tax treatment of the proposed on-market buyback". And judging by today's share price action, investors aren't fussed.
According to the release, if the buyback were to proceed, the ASX All Ords stock could be required to withhold up to 30% of the proceeds from those shareholders selling into the buyback because of US withholding tax requirements.
Resolving these types of issues takes time, and GQG Partners doesn't believe it will be able to resolve this uncertainty before entering its year-end blackout period.
The company said it would continue to review the matter and may elect to pursue a buyback in the future, subject to US tax conditions.
Funds update
Separately, GQG Partners also released its November funds under management (FUM) update.
The ASX All Ords stock reported a total FUM of US$159.5 billion, up from US$159.4 billion at the end of October.
Gross flows for November were US$4.2 billion, up from US$2.6 billion in November 2023.
