Escrow Watch: Which company that’s shrunk 66pc since its IPO has put off a shares release?
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In November, nearly two dozen ASX companies are releasing nearly 270 million escrowed shares – a list that was set to include one company that’s lost approximately two-thirds of its value since its IPO two years ago.
Escrow Watch is Stockhead’s monthly recap of the ASX companies that are releasing shares currently in escrow (also known as restricted securities) over the coming weeks.
ASX shares in escrow are “locked away” and not listed on the bourse so owners can’t sell them – until they’re released.
This is intended to depict to would-be investors when raising capital that the management and previous investors are still committed to the venture and aren’t raising capital just so they can “sell out”.
While there’s no guarantee holders of escrowed shares will sell at that point, the mere fact that they will be able to is worth knowing – particularly if shares have substantially moved one way or the other.
Click here for a more detailed description of the ASX rules surrounding escrow arrangements.
|Code||Company||Date of Release||Shares released||Shares on Issue|
|CPO||Culpeo Minerals||12 and 30 Nov||1,069,352||2.59%|
|BMO||Bastion Minerals||5 and 17 November||250,000||<1%|
|POL||Polymetals Resources||6 and 12 November||336,111||<1%|
|FFT||Future First Technologies||2-Nov||6,000,000||1.40%|
|PNM||Pacific Nickel Mines||4-Nov||10,617,954||4.94%|
|HDN||HomeCo Daily Needs REIT||23-Nov||129,000,000||16.31%|
|MTM||Mt Monger Resources||30-Nov||427,500||1.54%|
While this stock is off its all-time lows, it has never traded above its 50 cent per share IPO price and its 17 cent share price is a whopping 66% loss compared to its listing price.
But things have looked up for the company in the last month, after it announced a merger with Queensland-based medicinal cannabis company, CDA Health, and recorded $1.1 million in sales in the September quarter.
And on Friday, the company got the majority of these shareholders to agree to another 12-month escrow so long as this deal was complete by the end of the year – otherwise they will be released immediately on New Years’ Eve.
More than a third of this month’s total – 129 million – is being released by HomeCo Daily Needs REIT (ASX:HDN), a real estate investment trust run by Home Consortium (ASX:HMC) and specialising in shopping malls that are home to consumer staple retailers (such as grocers and chemists).
These shares, directly owned by HMC, will be released on November 23 at 4.15pm, which is the first anniversary since it listed.
Only a fortnight ago, it was announced HDN would be merging with fellow REIT Aventus (ASX:AVN). Although mergers and acquisitions are sometimes a permitted reason to break escrow arrangements early, it won’t be in this case, with the deal not expected to be complete until mid-February next year.
PropTech Group (ASX:PTG) is releasing 50 million of its shares on the first anniversary of its “re-listing”. This company was once known as Real Estate Investar Group but changed its name and had to re-apply to list on the ASX following several “proptech” acquisitions in the CRM space because it was a “significant change” to activities.
Several resources companies make up space on this month’s list.
One of the ASX’s largest biotechs Telix Pharmaceuticals (ASX:TLX), is releasing nearly 21 million shares.
The shares in question belong to China Grand Pharmaceutical and Healthcare which bought into a commercial partnership with Telix a year ago and made an investment then worth $35 million.
These shares were issued at $1.69 but with Telix’s share price at nearly $6, these are now worth over $124 million.