Shares in Gateley (GTLY) fell by around a tenth on the news that certain directors and employees would sell up to 4m shares at no less than 150p, representing approximately 3.6 per cent of its issued share capital and a 12.5 per cent discount to the prior day’s closing price of 171.5p. The placing was ultimately oversubscribed, raising £6m for the respective sellers. It was undertaken to “satisfy market demand and broaden the institutional investor base”.
This share sale didn’t come out of the blue. When Gateley joined Aim in 2015, its former partners held 70 per cent of its share capital. These partners voluntarily entered five-year lock-in agreements, allowing them to sell up to 10 per cent of their holdings in any 12-month period after the first anniversary of admission. And they had already sold twice since IPO. In October 2017, they offloaded 6.6m shares at 150p each, while in October 2016, they sold 5.8m shares at 111p each.
