Central asia metals large director sale

11th Feb '18 by Andrew niven

2 comments 2563 reads

This share has been on my radar for a long time and their recent acquisition looked very interesting plus good results.
However will this recent large director sale affect the share price

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Andrew Niven

Premium Member

2 comments

Carcosa

11th Feb '18

It's the non-Exec Director, Rakishev, who had obtained his 19% of the London-based firm's equity capital via the sale of a 40% stake in Kounrad to Central Asia Metals (LON:CAML) , which had previously been a 60/40 partnership between the two, back in May of 2014. He was CAML’s largest investor prior to the Lynx Resources takeover.

At that time of the Lynx Resources takeover Rakishev he said he would sell his shares (19% stake) “in order to release liquidity and manage his broader investment portfolio”. He is now chairman of the board of directors for a number of large companies including SAT & Company (KASE: SATC), a diversified industrial holding company. He also serves as chairman of NASDAQ-listed Net Element International, Inc. (NETE) and is a director of JSC Kazkommertsbank. He has also recently become the largest shareholder in the gold miner Petropavlovsk.

This last tranche (6%) is the final sale of his shareholding and so now I suspect that he will possibly step down from the board in the not too distant future since CAML have moved away from his apparent area of interest.

Therefore, in answer to your question, the sale of 16% of the company has not had a significant effect on the share price IMO as the shares appear to have easily found a buyer; perhaps Fidelity. Of course, with world markets throwing everything out of the pram recently share price action has been unfavourable to investors....

gus 1065

11th Feb '18

The same director, Mr Rakishev, sold the other half of his holding at the time of the placement made on 26th September 2017 to finance the acquisition of Lynx Resources. Rakishev is variously described as a Kazakh tycoon with numerous industrial interests in the region. Rakishev has now completely exited his previous 12% September position (once as high as 19%).

The Central Asia Metals (LON:CAML) shares have had a good run since his original sale, suggesting his exit has been an orderly one and that the Lynx acquisition was perceived as being a good buy. The sharp fall last week possibly reflects the general sell off in the market, especially for many commodity stocks ( Glencore (LON:GLEN) for example was off well over 12% over the same period), compounded by this placement of 6% of the company’s shares on Friday. I have a small holding here based on the strong Stocko metrics, low p/e and decent apparently sustainable yield, but am wary of such a material stakeholder cashing in his chips - even if he maybe has better use in his empire for his investment capital here. Will let my holding run for the time being but watch closely.

Gus.

—————-
Extract from 26/9/17 RNS.

Selling Shareholder
The Selling Shareholder is CBH Europe Limited as holder of 10,605,875 Ordinary Shares which were pledged to it by Mr Rakishev, one of the Company's Non-Executive Directors, pursuant to arrangements announced by the Company on 5 May 2017. Mr Rakishev is the beneficial owner of and continues to have an interest and voting rights in respect of these Ordinary Shares and he has authorised their sale.

The Selling Shareholder has entered into an agreement with the Joint Bookrunners in respect of the sale of these shares and pursuant to which the Joint Bookrunners will be paid certain commissions and expenses by the Selling Shareholder. The Selling Shareholder Placing is underwritten by the Joint Bookrunners. The Selling Shareholder Placing is conditional upon, amongst other things, the Company Placing and Admission. The Selling Shareholder has also given a standstill undertaking to the Joint Bookrunners not to enforce its security in relation to these Selling Shareholder Placing Shares prior to Admission or the termination of the Placing.

Mr Rakishev remains the legal and beneficial owner of a further 10,605,876 Ordinary Shares which remain subject to a pledge in favour of JSC CenterCredit Bank (CenterCredit) as announced by the Company on 2 July 2014.

Mr Rakishev has entered into an irrevocable undertaking to vote in favour of the Resolutions in respect of all of the Ordinary Shares he is beneficially interested in, totalling 21,211,751 Ordinary Shares. In respect of the 10,605,876 Ordinary Shares Mr Rakishev will be interested in following Admission, he has entered into a lock-in agreement pursuant to which he has agreed that for a period of 90 days from Admission he will not, without the prior written consent of the Joint Bookrunners, sell or contract to sell, grant any option over or otherwise dispose of any such Ordinary Shares (or any interest therein), or enter into any transaction with the same economic effect as any of the foregoing, other than pursuant to any security granted by him to CenterCredit. CenterCredit has agreed that should it become entitled to these shares during this period it has agreed that it will comply with the terms of the lock-in given by Mr Rakishev.

The relationship agreement with Mr Rakishev will be terminated with effect from Admission as Mr Rakishev's interests in the Company will be below 14 per cent. of the enlarged share capital following Admission.

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Central asia metals large director sale

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About the Author

Andrew Niven

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