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Rausing completes hefty Ocado purchase

Top brass top up stakes via incentive plan
March 24, 2021
  • Non-executive director buys £16m-worth of shares 
  • Other senior management reap rewards of incentive plans

Ocado (OCDO) non-executive director Jörn Rausing – a member of the Swedish Tetra Pak dynasty - bought £16.3m-worth of shares last week, among a rush of alerts from the company that showed other members of senior management reaping the rewards of various incentive schemes. 

Chief executive Tim Steiner sold £1.67m worth of shares that he received via the group’s long-term incentive plan, in order to settle “associated tax and national insurance liabilities.” The remaining shares awarded – which are currently worth around £2m – are in a restricted account in Steiner’s name, where they are subject to a two-year lockup. Luke Jensen, who is the head of the company’s software solutions business, took his pre-tax £1.6m reward in full. 

A number of other c-suite executives received smaller benefits from Ocado’s various incentive plans this week. But Rausing’s transaction was independent. The Swedish businessman, who has been on the board since 2003, did not offer a comment on the huge purchase. But we think he could have been tempted by a prolonged dip in the share price, which has dropped by a quarter since its 2021 high last month. 

That is despite the fact that it revealed that revenues from its retail business had grown by 40 per cent to £599m in the 13 weeks ended in February. But investors were still left wanting: the update did not include any meaningful detail on the B2B software product, which is viewed as one of the company’s key long-term growth drivers – and is largely responsible for Ocado’s super-charged, tech valuation. 

Rausing’s big transaction may offer some comfort to shareholders, but we think caution is still warranted. The extent to which the online grocer’s online solutions product will be accepted by corporate clients is still not clear, and while the retail division is performing well, the omission of any new information on the software business was glaring. Hold at 2,080p.

Buys    
CompanyDirector/PDMRDatePrice (p)Aggregate value (£)
4imprintJohn Gibney19 Mar 20213,00069,600
AvivaJim McConville16 Mar 202139549,997
CLS HoldingsLennart Sten17 Mar 202123493,580
Harworth GroupLynda Shillaw (ce)18 Mar 202112449,736
Hikma PharmaceuticalsMary Regina (Nina) Henderson17 Mar 20212,20335,248
John MenziesAlvaro Gomez-Reino (cfo)16 Mar 2021299119,600
OcadoJörn Rausing19 Mar 20211,98916,279,292
PlaytechAndrew Smith (cfo)16 Mar 202142126,102
PlaytechMoran Weizer (ce)16 Mar 202142880,458
Reckitt BenckiserOlivier Bohuon16 Mar 20216,31631,580
SynthomerDato' Lee Hau Hian19 Mar 2021465225,321
Sells    
CompanyDirector/PDMRDatePrice (p)Aggregate value (£)
AvivaMark Versey (PDMR)16 Mar 2021393243,600
InterContinental HotelsPaul Edgecliffe-Johnson (cfo)16 Mar 20215,20093,600
Shanta GoldEric Zurrin (ce)18 Mar 202113272,077
Shanta GoldLuke Leslie (cfo)18 Mar 202113372,636