Directors Trades: To take your stock off market you have to drop a lot of cash
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Last week was another quiet week among directors trades but a handful still made big trades (above $100,000).
The biggest trader was once again Ian Gandel of Alliance Resources (ASX:AGS), this week buying $2.8 million. He has been on the company’s board since 2003 but now thinks it would be better for its gold project to be developed off market.
Alliance’s gold project lies in South Australia’s Gawler Craton and it has indicated and inferred resources of 1.1 million tonnes at 5.1g/t gold for 181,000 ounces.
Anti-fraud software stock Adveritas (ASX:AV1) saw two directors make big purchases in its recent capital raise. Matthew Ratty bought $300,000 and Mark McConnell bought $1 million.
The company targets the digital marketing sector which will see ad fraud a US$100 billion problem by 2023. Currently, the industry uses a ‘blacklist’ which blocks some affiliates completely. But its software, TrafficGuard, analyses user behaviour to determine if ad engagement is genuine or delivered by fraud.
The company told shareholders it is now at a tipping point, having engaged marquee clients it is now scaling globally. Its clients include tech unicorns Gojek and Rappi.
Equus Mining (ASX:EQE) director Mark Lochtenberg put $135,000 into the Chilean focused precious metals miner. Earlier this month it exercised an option to acquire a project owned by Canadian listed Mandalay Resources only three months after entering into an agreement which facilitated this.
It has 29,495 hectares to explore and there is a processing plant which can handle up to 1500 tonnes per day.
Race Oncology (ASX:RAC) director William Garner bought $100,000 in a placement. There are plenty of biotechs fighting cancers but the majority of these are trialling unproven drugs.
Race is trialling a drug that has been shown to work in the past but was the victim of a big pharma merger — in that it was disregarded because it was not a large enough market opportunity. The stock has nearly doubled since a major biotech entrepreneur backed the company in that capital raise.
|EQE||Equus Mining||Mark Lochtenberg||Buy||14 October||13,500,000||$135,000||Rights Issue|
|RAC||Race Oncology||William Garner||Buy||14 October||1,515,151||$100,000||Placement|
|AV1||Adveritas||Mark McDonnell||Buy||15 October||10,000,000||$1,000,000||Placement|
|AV1||Adveritas||Matthew Ratty||Buy||15 October||3,000,000||$300,000||Placement|
|AGS||Alliance Resources||Ian Gandel||Buy||9-14 October||14,751,184||$2,826,507||On market|
|KTG||K-TIG||Kieran Purcell||Sell||14-18 October||881,114||$296,334||On market|
How can you reap the fruits of your labour without raising eyebrows with shareholders? Exercising options.
Remember that Victorian based miner Stavely Minerals (ASX:SVY) which came across a 40 per cent copper hit? It closed at 24 cents the day before but now sits at $1.29.
Four directors, Christopher Cairns, Jennifer Murphy, Peter Ironside and Amanda Sparks all exercised options at 36 cents. This created $7.6 million in new shares between them.
|Director||Options exercised||Shares acquired||Value (Friday 4pm)||Total shares owned|
The reason they weren’t issued the same number of shares for options was because of how Stavely’s Employee Incentive Plan is structured.
When options are exercised, the number of shares issued is the value to the difference between the market price and the exercise price, otherwise payable.