Shares in the Aim listed Mortgage Advice Bureau have tumbled this morning (27 April) after several directors announced plans to sell part of their stakes in the network.
A stock exchange note announced individual shareholders and some of their spouses and Sipps intend to sell around 7.5 million ordinary shares in the mortgage network to institutional investors.
The placing represents up to 15 per cent of its issued share capital.
Mortgage Advice Bureau chief executive Peter Brodnicki plans to sell more than 325,000 of the company’s shares, alongside chief operating office David Preece who will sell 275,000 shares.
Mr Brodnicki intends to gift for nil consideration 676,000 ordinary shares, representing about 1.34 per cent of the issued share capital, to his wife, Stephanie Brodnicki.
All of these shares are intended to be sold in the placing.
Shortly after the announcement, shares in the Mortgage Advice Bureau plummeted 8.6 per cent to £3.70 per share. At 11am the price had sunk further and was down 12 per cent at £3.56.
Finance director Lucy Tilley explained that the share price has risen over the last few weeks and has “been quite volatile”, so this just represents a fall back to the original placing price of around £3.60.
She also said the reason for the share sale was merely due to some directors having their first opportunity to take some money, as the firm reaches the end of its first lock-out since its listing a few years ago.
MAB listed on Aim in November 2014, valued at almost £81m.
Prior to admission, Mr Brodnicki and connected trusts went from having a 53.3 per cent stake in the business, to 35.9 per cent. The remaining directors and members of senior management owned about 13 per cent.
JP Morgan Asset Management had a 9.9 per cent stake in the mortgage network, Henderson Volantis Capital had a 6.7 per cent holding, Investec Asset Management had 6 per cent, while Majedie Asset Management had 5.3 per cent.
By last September, revenue was up 28 per cent during the first six months of 2015 to £31.2m, driven by a 20 per cent increase in the average number of advisers in the year to the end of June to 638.
Elsewhere in the stock exchange announcement, MAB stated company secretary Paul Robinson intends to gift for nil consideration 300,000 ordinary shares to a third party, who does not constitute a family member for the purposes of the Aim rules, after which he will no longer have any disclosable interest in those shares.
MAB also intends to grant options to Mr Brodnicki, Mr Preece and Ms Tilley, in line with its executive share plan, to the value of twice their basic salary.