EOH rebounds after ‘involuntary trading’ sent it reeling last week
EOH’s share price rebounded 7.4% to R51.05 on Monday morning after it said the previous week’s 44% crash was caused by "involuntary trading" when two directors’ shares were sold by stockbrokers.
EOH said shares worth R143m were sold by its chief financial officer John King and executive director Jehan Mackay.
Mackay sold R9.4m worth of shares on Tuesday at an average price of R78, R17m worth on Wednesday at an average price of R72, R91m worth on Thursday at an average price of R50 and R9.4m on Friday for an average price of R31.
EOH said this was a forced sale of shares triggered by financial institutions "due to the shares being linked to an equity finance transaction resulting in a margin call".
King similarly sold R16m worth of shares between Wednesday and Friday for the same reason.
"The equity finance transaction was implemented to acquire more EOH shares at the time," the company said in an "involuntary directors’ dealing" statement on Monday morning.
Furthermore, EOH said it had appointed law firm Edward Nathan Sonnenbergs to investigate allegations against its subsidiaries Grid Control Technologies, Forensic Data Analysts and Investigative Software Solutions.
EOH said it had "finalised the sell-back agreement in order to unwind its acquisition" of the three companies accused of paying kickbacks to secure contracts from the police.