In a week of big money director deals with millions of shares and tens of millions of pounds changing hands, the most significant comes from emerging markets fund group Ashmore (ASHM).
Its billionaire founder and chief executive Mark Coombs, who has a net worth of £1.5bn according to the Sunday Times, sold 10m shares last Friday at 550p apiece for a total of £55m.
CONCERNS OVER ‘CREEPING CONTROL’
The sale is part of Coombs’ promise to sell up to 4% of his shares per year in the FTSE 250 company, in order to reach a ‘more appropriate level’ of investment.
It has not been disclosed how many shares he now holds in the company, but following his last sale in September – where he sold £15m worth of shares – he had a 37% stake in the business.
Coombs has been boss of Ashmore since setting up the business in 1998. In recent years he has been systematically dialling down his stake after concerns from investors over the risk of him gaining ‘creeping control’ over the company.
Investor advisory group Institutional Shareholder Services warned last year that if Ashmore were to repurchase shares and Coombs did not participate, it could lead to an increase in his shareholding.
The company has been on a strong run in the past year and a half, with its share price rising from around 350p to 557p today as more investors look to allocate money to emerging markets.
In its latest full year results the firm reported a 24% increase in assets under management, with its short-duration, blended debt and local-currency bond emerging market strategies particularly popular with the institutional investors which make up the majority of its client base.
DIRECTOR RESIGNS AFTER SELLING £22M STAKE
A little closer to home, another big director deal over the past week involved Sunderland-based sofa and carpet retailer ScS (SCS).
Major shareholder Parlour Products Holdings, represented on ScS’s board by non-executive director Paul Daccus, has sold its entire 25.9% stake in the business, offloading 9.8m shares at 220p each for a total of £21.7m. He has since resigned as a director.
Alan Smith, chairman of ScS, said: ‘Paul has been a director since the company listed in 2015. Throughout that time, Paul's advice, commitment and support has been greatly valued by the whole ScS team. The board will miss his contribution.’
Trading in the company’s shares has been volatile since it listed, with its current share price of 240p just 50p higher than the closing price on its first day of trading in January 2015.
ScS has largely managed to avoid the fate suffered by rival sellers of big-ticket items such as Carpetright (CPR) and DFS (DFS), and reported better than expected profits in its latest full year results.
But it also warned that the start to its current financial year has been impacted by lower like-for-like orders, with political and economic uncertainty having dented consumer confidence.
NEW MICRO FOCUS BOSS BUYS £1.5M STAKE
In other deals, new Micro Focus (MCRO) chairman Greg Lock, together with his wife Rosemary, bought 184,300 shares on Tuesday at 787p each for a total of around £1.5m.
The act of faith in the business comes as Micro Focus struggles with the integrating of its 2017 blockbuster acquisition of Hewlett Packard Enterprises (HPE).
Having seemingly bit off more than it can chew, the firm reported lower than expected revenue and profits for the year ended 31 October 2019, part of which it attributed to the ‘greater than expected complexities’ from the HPE integration.
But in a strategic review the firm has been able to identify several areas where it can improve, and if all else fails, there’s speculation the company could be a potential takeover target.