Escrow Watch is Stockhead’s fortnightly recap of the small cap companies releasing shares that have been locked away in escrow.

Escrow refers to shares that are held by early investors or directors, who are restrained from selling them for a year or two.

The release of escrowed shares can have a big impact on a stock’s price. If the holders choose to take up their right to sell – the shares you own can fall.

This is particularly important in a time when markets are predominantly in a bearish mood. Now these shareholders have a chance to join in whereas previously they could only sit back and watch.

Over the next fortnight, eight companies are releasing shares. Although the total number is relatively small at 65 million, three companies are releasing share parcels worth more than 10 per cent of their market capitalisation.

Code Company Date of Release Shares % of company
LIT Lithium Australia 12 March 7,108,511 1.24%
SVY Stavely Minerals 13 March 1,203,601 0.56%
LPE Locality Planning Energy Holdings 13 March 16,000,000 31.90%
EM2 Eagle Mountain Mining 14 March 17,494,226 18.92%
CYL Catalyst Metals 15 March 8,680,000 10.53%
JAN Janison Education 16 March 6,694,076 3.69%
OSX Osteopore 18 March 5,439,213 5.37%
ATL Apollo Tourism & Leisure 26 March 2,575,214 1.38%

 

The biggest releasers

Eagle Mountain Mining (ASX:EM2) is releasing the most shares: 17.5 million worth nearly 19 per cent of the company. It is a copper-gold explorer focused on the copper-rich US state of Arizona.

Next on the list is  Locality Planning Energy (ASX:LPE), which is letting a 16 million strong package of shares off the leash, which equates to about 30 per cent of the energy retailer.

While the company upped its half-yearly revenue by 50 per cent, it booked a $3.4m dollar loss due to an increase in employee costs and a change in fair value of hedging instruments.

Victoria-focused gold explorer Catalyst Metals (ASX:CYL) is releasing nearly 8.7 million shares, equal to about 10 per cent.

Also active in the Garden State is Stavely Minerals (ASX:SVY), but its release of shares from escrow is much smaller at 1.2 million.

Stavely hit 40 per cent copper in September last year leading to it quintupling in value over just a few weeks. It followed that hit up with an intercept grading 26.8 per cent copper last month.