You are currently browsing the daily archive for August 31, 2008.

Lord Cairns and Guy Wilson, both recently appointed non execs at Fresnillo (FRES, 405p) have both invested £57,000 each, to initiate a position in the worlds largest silver mine.

I take these purchases with a pinch of salt, as

1. Cairns and Wilson have only recently taken up their positions as non execs (April and July this year respectively).

2. Judging by their age and extensive management history, I suspect £58k is a minimal investment compared to their net worth (see Fresnillo plc website for short bio’s)

I therefore rank these maiden purchases as giving me a WEAK SIGNAL, pending further financial commitment by these two non execs.

In times of uncertainty as to the direction of the oil price, it is with heightened awareness that I look at directors dealings in the oil sector.

But Lord Kerrs purchase of 2500 shares in Royal Dutch (RDSB, 1892p) at £18.72p doesn’t give me any direction.

He has been a consistent buyer over the last few years, but his purchases always seem to be in the upper half of the trading range for Royal Dutch’s shares.

In each of the last three purchases, he could have bought 5-10% cheaper within the next 1-3 months.

I know regulations only allow a narrow window for directors to deal in shares of their own company, but that is no excuse for paying too much.

There’s been a lot of hype surrounding Liberty International (LII, 984p) recently, with two ‘stakebuilders’ active (see Times comment below)

So it is interesting to see an announcement on Friday about a PDMR (senior management) individual exercising options and selling all the shares. ‘Normal’ behaviour across most situations where options are exercised, is to sell sufficient to pay all associated taxes (so around 40% of the exercised shares).

Liberty announced that (PDMR) Harold Newton had exercised 22638 shares, and sold the same number, leaving his holding unchanged at 93010 shares. One implication of this might be that Newton didn’t think it imperative to hold on to the 13,000 shares he didn’t need to sell for tax reasons.

August 23, 2008

‘Bid prospect puts new life into Liberty International

Market report

Bid speculation became the dominant theme in a rising market yesterday with much attention centred on Liberty International, the group behind shopping centres including Lakeside and Covent Garden.

Liberty rose 70p to 945p after news that Simon Property Group, one of the largest public real estate operators in America, had raised its stake in the company to 3.45 per cent.

Simon has been gradually and quietly building its stake in the British retail-focused real estate investment trust (Reit) for the past few months, taking advantage of its weak share price, dragged down by plummeting property valuations. This month Liberty reported a 7.4 per cent fall in the value of its portfolio and gave warning that the property market was unlikely to pick up in the near future.

It is understood that the two groups have a close relationship, but it is thought unlikely that Simon’s stake-building will lead to a bid. The 8 per cent rise in Liberty’s share price also reflected a degree of short squeezing as those who had been bearish on the company covered their positions.’

I remember fondly my Haynes manual, covered in grease and brake fluid, and an absolute necessity in my dire attempts to reassemble my sky blue Triumph Herald after my earlier overenthusiastic exploratory activity.

So I’ve taken a look at recent directors dealings in Haynes (HYNS, 178.5p), despite its very limited size (£13m mkt cap).

Chairman John Haynes on Thursday bought 35,000 shares (including 20,000 in his wifes name) at 170p, up 30p from the previous days close due to enthusiastically received results. Haynes now holds 130,000 shares.

Chief Executive Eric Oakley bought 20,000 shares at 165p, taking his holding to 43,000 shares.

I believe these purchases to be significant:

1. They are an increase in existing holding of 35% and 90% respectively.

2. They are the first purchases by Haynes directors in almost SIX years. Also worth noting is that Director MEF Haynes last sold shares at 378p in March ’05, and John Haynes last sold in October ’03 at 313p.

I believe the Signal Strength implied by the directors purchase activity merits a STRONG rating.

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August 2008