Non-executive director Sander Van ‘t Noordende has bought his first stake in Micro Focus, purchasing American depositary shares worth around $145,325 (£111,865). American depositary shares are used by US investors to buy shares in non-US companies.
Mr Van ‘t Noordende is one of the newest members on the board, having joined in June this year. He has arrived at a troubled business, which has seen its market value shed more than three quarters so far this year. Its share price has struggled to recover from the March sell-off, having already been depressed by its disastrous acquisition of Hewlett-Packard Enterprise’s (US:HPE) software business back in 2017.
The deal cost an eye-watering $8.8bn. Its integration was ultimately a failure, with a review conceding that the business's IT systems were simply "not fit for purpose". And the company’s fortunes have still not returned: recent trading has lagged, with revenues dropping by over a tenth in the first half of 2020. This was compounded by a painful impairment charge of $922m, which pushed the company into a $1bn pre-tax loss. Small wonder that net debt (excluding lease liabilities) more than doubled, with its net debt to adjusted cash profits ratio sitting at a multiple of 3.3.
It is somewhat encouraging then that Micro Focus has managed to secure an extension for its $350m revolving credit facility to June 2024. The company now has no maturity dates before then, which should give it some time to review its borrowing. Total liquidity stands at around $1.05bn.
In a sign of growing management confidence, last month non-executive chairman Greg Lock and his wife added to their stake in the company, increasing their combined position by around a fifth.
Buys | |||||
Company | Director/PDMR | Date | Price (p) | Aggregate value (£) | Comments |
Ninety One | Hendrik du Toit/Kim McFarland | 30 Sep 20 | 203.11 | 573,098 | Purchased by PCA |
Centamin | James Rutherford | 5 Oct 20 | 151.68 | 151,680 | |
Micro Focus International | Sander Van 't Noordende | 2 Oct 20 | 248.77 | 111,865 | Converted from US$, American Depositary Shares |
Midwich | Stephen Fenby | 5 Oct 20 | 320 | 80,000 | |
Georgia Capital | Kim Bradley | 30 Sep 20 | 365 | 54,813 | Converted from US$ |
Amigo Holdings | Gary Jennison (ceo) | 1 Oct 20 | 9.55 | 47,750 | |
Playtech | Anna Massion | 2 Oct 20 | 355.27 | 42,633 | Converted from US$ |
Topps Tiles | Darren Shapland | 1 Oct 20 | 49.5 | 29,700 | Purchased by PCA |
Rotala | Bob Dunn | 5 Oct 20 | 25 | 27,500 | |
Diversified Gas & Oil | David Johnson | 5 Oct 20 | 105 | 26,249 | |
Topps Tiles | Robert Parker (ceo) | 2 Oct 20 | 48 | 24,000 | |
Midwich | Andrew Herbert | 6 Oct 20 | 320 | 22,400 | Purchased by PCA |
Go-Ahead Group | Elodie Brian (cfo) | 2 Oct 20 | 585 | 19,893 | |
FirstGroup | David Martin (ch) | 30 Sep 20 | 38.2 | 19,100 | Purchased by PCA |
Sells | |||||
Company | Director/PDMR | Date | Price (p) | Aggregate value (£) | Comments |
Pets at Home | Louise Stonier | 29 Sep 20 | 406.2 | 32,213 | |
Pets at Home | Louise Stonier | 29 Sep 20 | 402.2 | 31,915 | Sold by PCA |