Escrow Watch: Wiseway founders free to sell almost half of company
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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.
Coming up, eight small caps are set to release almost 300 million shares between them.
|Code||Company||Date of Release||Shares||% of company|
|WWG||Wiseway Group||26 February||64,573,277||46.02%|
|PGL||Prospa Group||27 February||20,723,763||12.83%|
|DEG||De Grey Mining||27 February||66,168,279||6%|
|IDX||Integral Diagnostics||27 February||3,126,006||1.60%|
|POD||Podium Minerals||28 February||16,721,672||10.31%|
|ACF||Acrow Formwork and Construction Services||28 February||2,583,332||1.25%|
|FFL||Founders First||1 March||10,038,733||8.12%|
|IMR||Imricor Medical Systems||2 March||28,786,493||31.06%|
|AGH||Althea Group||4 March||10,000,000||4.29%|
|STN||Saturn Metals||6 March||20,000,001||27.33%|
|EM2||Eagle Mountain Mining||14 March||17,494,226||18.92%|
The largest chunk of stock being released is from Wiseway (ASX:WWG) founders Florence and Roger Tong.
They agreed to a 16-month escrow for their 46 per cent of the company when it listed in 2018, pitching a logistics angle to the Chinese goods trade.
Wiseway, now 15 years old, is a freight company handling personal and commercial shipments between Australia and China.
Its traditional focus for outbound trade to China was the daigou (Chinese for ‘to buy on behalf of’, describing Chinese shoppers who buy local products and send them back home) market in Australia, particularly for infant formula and other nutritional products.
When it listed it broadened its activities to include international logistics services, especially via air freight, for perishable items such as meat, dairy products and fruit exported from Australia to China.
It raised $26m in the IPO at 50c a share, but has never traded at that price, falling to an all time low on Wednesday of 14c.
The lightly traded company has not told investors whether or how it has been affected by the coronavirus lockdowns in China.
The other large escrow shares release this month is from US-based Imricor (ASX:IMR).
Imricor develops MRI-compatible products for cardiac catheter ablation, a procedure that uses energy to make small scars in your heart tissue to prevent abnormal electrical signals from moving through your heart.
Just over 31 per cent of the company will be freely tradable after coming out of a six-month voluntary escrow following the IPO last year. Most is from investors unaffiliated with the company.
Imricor raised $12.1m in the IPO in August and this month the Minneapolis company raised another $20.3m in an institutional placement to new and existing sophisticated and professional investors.
It’s planning to let local investors buy in as well with a $2m share placement.