Rakon managing director Brent Robinson and his brother and executive director Darren Robinson have agreed to sell some 493,000 recently purchased shares each after the transactions breached the Takeovers Code.
This month the brothers each bought $81,539 worth of shares, representing 0.52 percent of the Auckland-based crystal oscillator maker, though in doing do breached the code as they, along with their father, own more than 20 percent of Rakon.
The company's board intends to consider asking for shareholder approval allowing the Robinson family interests to buy shares if they want to do so in the future.
Because of the breach, the Robinson brothers have given the Takeovers Panel enforceable undertakings to sell the shares within a seven week period and not to vote the percentage of shares acquired before the sales being completed.
"The sale of the 0.52 percent of the company's shares by Brent Robinson and Darren Robinson is solely as a result of a legal requirement rather than any change in their views about the company's position or prospects," Rakon said in a statement.
The two on-market purchases on July 9 and 11 were at an average price of 22.2 cents per share, and came after Rakon said it's selling 80 percent of a Chinese joint venture factory to a Chinese electronics manufacturer for US$18.8 million in a bid to cut debt.
Chairman Bryan Mogridge dismissed concerns by the New Zealand Shareholders' Association over an unusual gain in the company's share price ahead of the joint venture sell-down, saying "no company directors or staff, or their related parties, who are required to comply with the company's Securities Trading Policy, have sought or been granted approval to buy or sell shares before the announcement."
Rakon's shares are the sixth-worst performing on the exchange this year, shedding 32 percent. The stock was unchanged at 25 cents today, valuing the company at $47.8 million.
The company reported a loss of $32.8 million in the year ended March 31, wearing a $17.3 million impairment charge on its China-Timemaker and New Zealand units, with earnings before interest, tax, depreciation and amortisation of $5.1 million, near the bottom end of a twice-downgraded forecast.
By Paul McBeth - BusinessDesk