Two company bosses have put a big show of faith in their businesses over the past week after buying big chunks of shares.
Chuk Kin Lau, CEO and executive director at coffee table book publisher Quarto (QRT), bought 9.4m shares at 68p each as part of a share offer which aims to reduce the company’s bank debt.
Quarto raised £13.9m in total with Lau taking up 42.6%, or £6.39m worth, of the shares offered.
The company announced the share offer last month after revealing that it owed $54m to its bank and another $13m in loans.
Quarto said, ‘This figure is significantly higher than expected for a company of the company’s size and profitability and the board considers that this debt presents a risk to the future profitability of the group and hampers the ability of the company to make dividend payments or other returns to shareholders.’
It also comes after the company rebuffed a 100p per share all-cash takeover bid from a US investor last month, which would’ve valued the firm at £90m.
Investors in online marketing company XL Media (XLM:AIM) reacted positively after new chief executive Stuart Simms bought a big wedge of shares in the business.
Sims bought 880,000 shares at 26.45p each yesterday for a total transaction amount of £232,000, a 9% premium to Tuesday’s closing price with the deal giving Sims a 0.47% stake.
XL Media shares jumped 11% in afternoon trading yesterday after the deal was announced. Sims was appointed boss of the digital marketing firm four months ago.
While some bosses have bought into their companies over the past week, other directors and those closely associated with them have cashed in to take advantage while the going is good.
The most notable deal involved Karen Ellis, wife of Berkeley (BKG) executive director Sean Ellis, who sold 34,000 shares at £53.49 this week, netting a total of £1.8m.
Housebuilder Berkeley has been on a strong run in the past six months, with its share price rising around 20% following increased confidence in the sector after the general election result.
Also helping it stay in vogue with the market is the fact that despite profits peaking in 2018, the company is still sitting on a big pile of cash - more than £1bn at the last count - which has enabled it to give some back to shareholders, with £500m due to be paid out to investors in March 2020 and a further £500m in March 2021.
