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Getagrip -following your comment, I’ve taken another look at how our VC shareholders operate. Your assessment is probably right and the VC’s will move-on - it is only a question of when. I may be wrong, but personally I don’t think it will happen immediately after the end lock-up, as that is too predictable, but we will see. What ML/AB, with a 16% holding, will do is the next question.
Summit Partners, our lead VC with 19% of the shares, has a business model different from investment banks. They invest and then take a very hands-on approach forming a partnership with management. Their exits strategy is to facilitate a “liquidity event” - these are seemingly mergers, take-overs or IPOs.
From what I can see, a year on from other IPOs they still have some holdings in some of their companies, so hopefully there will be a managed exit to prevent as little disruption to the SP as possible - I would have thought it is in their interests to do so. Or they will facilitate a take-over or merger to extract a further pennies worth. Whatever their game, they appear to me to be very accomplished operators.
I think the Investment Banks are a completely different animal to the various funds etc. The dynamic that drives them is invariably speed of gain. Many of them will be hard-wired to take a 3-400% gain made in only say 6-months!
The reasoning being that although Dark is a great company, great future, great investment as we have all discussed. For them the speed of gain has seismically changed. They are unlikely to forecast a share price hitting £30-£40 in the next 6-months. For them it is about maximising the capital growth from the value of the capital they have right now. There are a lot of competing investment alternatives available, often exclusively to them.
They are not long-term investors by nature, they are about extraordinary gains in a very short time. I think that a lot of their capital investment in Dark could easily walk on a strategically phased basis. I would be very surprised if they do not cause a dip in the SP.
Charles, the number of shares currently in fee float now is a good question and the answer depends on your source of information. If you take the shares floated at IPO and the two later secondary placements it comes to about 18%. This jibes with the 17.9% reported by Reuters. But someone, Nidec I think, was told by DT that it is 27%. It is possible that SHs who own less than 0.5% of the shares and the EBF (see below) make up the difference. I do not know how many of these smaller SHs there are and it is not clear to me whether these smaller SHs were subject to lock-up or not.
The total of those in the top 10SH list being released from lock-up sums to 329,524,552. The total number of shares in issue is currently 697,636,903. So roughly 50%.
I’m not sure what the status of the DT Employee Benefit Fund is regarding lock-up,but that fund holds 7.86% of the total share in issue.
Add to this ftse 100 and that’s it’s a fantastic business
I agree with lending ! I think the institutions know this has great potential and those that haven’t taken any profit may want to take some , but I’m confident in the share price remaining at a good level because of the volume bought in the recent platings . They simply wouldn’t have had the take up if the buyers thought they could get in cheap at the end of the lock in period .
Really good research Lending, thank you, that's very useful. :-)
There are several so-called 0.5% SHs who were subject to the lock-up arrangements and I expect some of those will want to sell sooner rather than later if they need the money. How the bigger SHs react is anyone’s guess, but I personally do not think it will be in their interests to unsettle the market and they will be playing a different game. Both Summit and KKR are represented on the BOD.
As to the free float post lock-up, I would guess the shares held by the employees - who are subject to a 360 day lock-up - are between 15-20% of the total - this includes the Employee Benefit Fund whose lock-up status I don’t know. - so the free float will probably be at least in the order of 80% post lock-up.
There is a research paper that analyses SP movements post lock-up. According to the abstract there is often a temporary drop, but there have also been cases where the SPs have risen, and risen sharply in one case (something to do with shorters being wrong footed).
Evening Marna, I've just been looking at Trustpilot out of interest. Quite a different situation to DARK although it appears similar superficially. Looking at their chart, the SP has been on a downward trend since September 1st, possibly due to bad publicity .
With DARK we've been on a good upward trajectory. Also some IIs were previously released from the lock-up terms and sold a chunk to take profits. So I don't think we're talking such a cliff-edge situation, maybe a mere step down before two steps up. :-))
As I said to Overman, it feels like the situation here has changed subtly. DARK - who were already damned impressive - have upped their game considerably since the last II-induced dip. I can't see how an II worth their salt would want to take all their profit off the table when more is clearly on the way. There is a danger however, that PIs and buyers(including myself) will trip themselves up by banking on a significant dip. Just my feelings at present. :-)
I did wonder what happened to trustpilot yesterday.
https://www.thetimes.co.uk/article/trustpilot-investors-hit-sell-with-lock-in-period-ending-k2dmhj3k9
DT next?
Jayne thank you for input
Lending, you may well be right. I only know I noted the 27th down as that was specifically mentioned.
Overman, I'm really reluctant to hazard a guess tbh. The very large buys after hours are making me wonder whether there will be much profit-taking from the II's when the lock-up does end. I've shelved my plan to sell a few beforehand for now, currently feeling that I might regret it.
I am still not totally convinced that the 27/10 is the last day of the lock-up period. This date assumes that the first day of the lock-up period is 30/4 – the first day of conditional dealings.
But this is what the RNS announcing the listing actually says about the lock-up period. I will leave it to you to make up your own minds whether the last day is the 27/10 or 2/11. It all hangs on the definition of “Admission” defined in the Prospectus as “ the Admission of Shares to the premium listing segment of the Official List and to trading on the LSE’s Main Market”
RNS quote
“Certain existing shareholders will be subject to lock-up arrangements restricting the disposal of Shares for a period of time following Admission.” (The period of time is 180 days)
“Admission to the premium listing segment of the Official List of the FCA and to trading on the Main Market for listed securities of the London Stock Exchange, and the commencement of unconditional dealings is expected to take place at 8.00 a.m. (London time) on 6 May 2021.” (this was the date)
Unquote
Note, too, that the 50% or so of locked-up shares (Summit, KKR, ML/AB etc) will only be able to be traded on the day after the end of the lock-up period IMO.
It might not on the day. Simple as, 3 days until then and a lot can happen. It's not the only event upcoming.
The question still remains: how many shares will be unlocked? Can/have they already sold some?
Also these sales could happen privately or already happened?
Thoughts? My view is it likely will drop a bit and I'll top up, I'm going to sell some other stocks to raise some cash I'm case.
GLA
Charlie share price dropped previously twice
Jayne how far do you think dark trace will fall 27th October
Thanks for the information Henry and Jayne :-)
I agree Charles, some profits were taken earlier by agreement, so in their shoes I would keep tight hold. We're still very cheap compared to our nearest competitors.
All the same I'll be topping up if if the window is open. :-)
Welcome to the board Dubious. Lock in for early investing II's ends on 27th, if they sell a load to take some profit, there could be a brief window to top up cheaper. :-)
It does seem quiet and fairly orderly for this share...
Strong position holding. Big buys yesterday. Good news incoming with FTSE.
I believe it's the 6 month lock-in period ending allowing IIs to sell their shares. Considering they made 3x their initial investment they may well sell, or hold...
Who knows.
I've only recently bought in here.
What's the relevance of the 27th?
Totally agree with Seaking1 about the rudeness on other boards, especially the travel sector.
I think so, I’m waiting for 27th to reinvest in DK as well??
Are we expecting a dump on this date?