An Ascendis Health director was last week forced to sell chunks of financed stock, further compounding the company’s share rout. 

The group’s shares have more than halved since Ascendis published annual results in late September and announced a new strategy that involves the sale of noncore assets.

Some analysts are concerned that the company, which has grown through a series of acquisitions in SA and abroad, is overindebted and is still struggling to ignite organic growth.

Ascendis said in a stock exchange filing late on Friday that nonexecutive director Gary Shayne, his spouse and his Gane Holdings company were forced sellers of about R13m worth of shares last week.

Shayne is the majority beneficial owner and CEO of Coast2Coast Capital, Ascendis’ largest shareholder. Coast2Coast founded Ascendis in 2008 and listed it on the JSE in November 2013.

The sales were “involuntary” as they were linked to equity finance transactions and margin calls were triggered.

The lowest price obtained was just R3.60, representing a more than two-thirds decline in the company’s share price since the start of September.

Less than a year ago, Coast2Coast bought 37-million new Ascendis shares at a price of R20. This was during Ascendis’ R750m rights offer, which it used to pay off an acquisition.

In Friday’s announcement, the parties said Coast2Coast was a “long-term shareholder of Ascendis and remains confident in the strategy of the company”.

Analysts have become increasingly critical of directors who hold instruments that can trigger share sales, such as leveraged stock positions that can give rise to margin calls.

In December 2017, a 35% decline in EOH’s share price in a single day was attributed to margin calls against equity-financed transactions.

In September, an MTN director was forced to offload R14.8m worth of stock.

Just One Lap founder Simon Brown said at the time he would “fire the director” as leveraged positions placed unnecessary risk on shares.