London Capital Group starts buying back its own shares


LeapRate Exclusive… UK financial spread betting firm London Capital Group (LCG.L) made an interesting move late last week, buying back a total of 45,000 of its own shares in the open market. These are the first buybacks ever done by LCG, as far as we can tell – LCG held no ‘Treasury Shares’ prior to the current buyback.

The amounts involved aren’t that large so far. With LCG shares trading in the £0.30-£0.32 range, the 45,000 shares were bought for a total of about £14,000, or $22,000. The 45,000 shares are just a drop in the bucket taking into account LCG’s total of 55.8 million shares. But the fact that a buyback was done at all is certainly significant, and may signal future, larger moves by management.

lcgGiven the recent turnover in LCG ownership and management, we wonder if these purchases were just a test for a much larger planned buyback. We are sure that Charles-Henri Sabet and his team have big plans for turning LCG around and building shareholder value, and investing excess cash into lowering LCG’s float might be part of that strategy.

So far, it actually seems to be working. Given the relatively low trading volume in LCG stock, the 30,000 shares bought last Thursday and 15,000 on Friday represented most of the trading volume during those two days – with the new ‘demand’ for LCG shares sending the price up from 28.50 pence Wednesday to 31.92 pence Friday.

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London Capital Group starts buying back its own shares

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