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Screenshot of a breaking news alert e-mail from Q2 2017
After the close of trading Thursday afternoon, Retail FX and CFD broker Plus500 Ltd (LON:PLUS) announced that a group of its founders, none of whom is involved any more in the day-to-day management of the business, are selling about a third of their remaining aggregate holdings in the company, in a secondary share sale organized by broker Liberum Capital.
The plan is for the group to sell, in aggregate, at least 7.27 million shares, at £11.00 per share, for a total take of £80 million (USD $110 million). That price marks a 5.4% discount to Plus500’s closing share price Thursday of £11.63. We’d note that Plus500 are near a 52-week and all-time high, driven up by the company continuing to produce record financial results, including for the recently-announced fourth quarter of 2017 which saw Plus500 bring in $132 million of Revenues.
Assuming that the sale goes as planned, the founders’ combined stake in Plus500 will be reduced from 22% to 16%.
This marks the first major share sale by the Plus500 founding group since a similar September 2016 offering, also arranged by Liberum. That share sale was significantly larger – 15.5 million shares, versus 7.27 million shares in this offering.
Assuming that the offering is closed overnight (we expect that it will be), it will be interesting to see how Plus500 shares react when they open for trading tomorrow. After the (similar) September 2016 secondary offering, Plus500 shares opened 16% down from the previous close.
Plus500 itself is not a party to the sale, other than its requirement to make the necessary regulatory filings, and the company will not receive any proceeds from the offering.
The full text of the Plus500 announcement reads as follows:
(“Plus500” or “the Company”)
Proposed Placing of no less than c. 7.27 million Existing Ordinary Shares in Plus500
Plus500, a leading online trading platform provider for retail customers to trade CFDs internationally, announces that the founders of the Company, Alon Gonen1, Gal Haber2, Elad Ben-Izhak3, Omer Elazari and Shlomi Weizmann (the “Founders”) have notified Plus500 that they intend to sell no less than in aggregate approximately 7.27 million existing ordinary shares (the “Placing Shares”) in the capital of the Company at a price of £11.00 per Placing Share (the “Placing”). The Placing Shares represent at least 6% of the Company’s issued share capital and the Placing is expected to raise gross proceeds of at least £80 million for the Founders.
The Placing will be executed through Liberum Capital Limited, the Company’s broker. Allocations shall be at the absolute discretion of Liberum. The results of the Placing will be announced as soon as practicable thereafter. Settlement of the Placing is expected to occur on a T+5 basis on 9 March 2018.
Plus500 is not a party to the Placing and will not receive any proceeds from the Placing.
After completion of the Placing, the Founders will continue to hold in aggregate approximately 16% of the issued share capital of the Company. The Founders intention to sell reflects their desire to diversify their investments whilst raising funds for personal reasons.
The Placing Shares, in all respects, rank pari passu with the Company’s ordinary shares.
The Founders have agreed with Liberum not to sell any further ordinary shares they hold in the capital of the Company for a period of 180 days after completion of the Placing.
This announcement contains inside information as defined in Article 7 of the Market Abuse Regulation No. 596/2014 (“MAR”).
(1) The shares are registered in the name of Sparta24 Ltd.
(2) The shares are registered in the name of Wavesoft Ltd.
(3) The shares are registered in the name of Smarty Ltd.