14th Jun 2023 13:49
(Alliance News) - Online trading services provider Plus500 Ltd on Tuesday said it bought back shares worth GBP101.3 million from Odey Asset Management LLP, claiming it was taking advantage of attractive pricing and the strength of its own balance sheet.
Plus500 bought back 7.3 million of its own shares from Odey at a price of 1,383 pence each, representing around 8.2% of its issued share capital, putting some distance between it and the embattled investment firm. The acquired shares will be held in treasury, Plus500 said.
London-based Odey has been engulfed in a crisis after founder Crispin Odey faced assault allegations.
Shares in Plus500 were up 0.8% to 1,493.00p each in London on Wednesday afternoon. In 2023 so far, they have fallen 17%. It has a market capitalisation of GBP1.35 billion.
"Given the significant strength of the company's balance sheet and the prevailing circumstances, the board believes the purchase is in the best interest of all shareholders," Plus500 said in a statement.
"The company has acted quickly to execute this opportunity to acquire shares at an attractive price, in-line with the company's capital allocation and shareholder return policy."
Plus500 said the transaction was conducted separately from its USD70.0 million share buyback programme, as announced in February, which it said is continuing as planned. As of Monday, Plus500 said it has repurchased approximately USD52 million of its own shares.
Also on Tuesday, Odey said it halted withdrawals from two of its funds and closed another amid an investor exodus.
The firm has banned investors from pulling out any more cash from its Brook Developed Markets Fund and Brook Absolute Return Fund, run by subsidiary Brook Asset Management, after a rush for the exit.
Odey has also decided to close its Swan fund after announcing it was reviewing options for the fund late on Sunday.
It comes as JPMorgan Chase & Co has also reportedly become the last of the major banks to cut ties with the scandal-hit firm as it comes under mounting pressure in the wake of sexual assault and harassment allegations against Odey.
The partnership – which has around USD4.4 billion in assets under management – announced on Saturday that Odey would be leaving following a series of allegations of misconduct. Odey denies the allegations.
In a move to further distance itself from Odey, the investment firm revealed a management shake-up of funds formerly run by its ousted founder and said it was planning to rebrand the partnership that is set to see Odey's name removed from the hedge fund.
Odey had insisted on Monday that its funds were open "as per usual business" as it was reported to be considering imposing restrictions.
By Greg Rosenvinge, Alliance News reporter
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