Property information firm PSG Solutions has announced a tender offer that will give shareholders to sell some of their shares back to the company at a sharp premium to the prevailing market price.
The proposed deal will see PSG's broker, Northland Capital Partners, offering to buy up to 1.84m ordinary shares at 225p per share, with PSG then buying them back at a total cost of up to £4.14m and cancelling them; in other words this is a share buyback that will directly benefit shareholders, rather than just market makers.
The proportion of shares up for cancellation amounts to 7.14% of the total share capital of PSG, and the price is a 184% premium over the closing price on Tuesday night. It's fair to say shareholders will probably be queuing up to take part, and it is likely that applications to sell shares will be severely pared back.
Subscribe to MoneyWeek
Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE
Sign up to Money Morning
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
PSG has form with this kind of transaction, as in September last year it completed another tender offer for 1.5m shares which were then cancelled. On that occasion, the offer price was 200p a share.
One of the directors of the firm, Bernie Connor, exercised options to buy 138,888 ordinary shares at 72p each last month. On paper this now looks like a rather sensible decision.
Over the last 12 months PSG shares have risen 472%. News of the tender offer saw the stock rise 23.4% by 10:47.
BS
-
8 of the best converted properties for sale nowThe best converted properties for sale – from an apartment in the former Hartley’s Jam factory on London’s Southbank, to a converted 18th-century mill in Itteringham, Norfolk
-
How taking a two-year career break could leave a £26k hole in your pensionCareer breaks are increasingly common but it is important to take steps to protect your pension, as gaps compound over time
