The huge number of shares traded in EOH — and the subsequent sharp drop in the share price — have been tracked to a forced sale of shares by financial institutions against equity financed transactions to various individual shareholders,including two EOH directors.
In a SENS statement today, EOH has confirmed that the directors affected did not voluntarily sell their shares, but rather that the sale was caused by margin calls against these equity financed transactions.
Shares belonging to Jehan Mackay of Tactical Software Systems were sold, to a total value of 127,07-million were sold between 5 December and 8 December, while R16,29-mllion of shares belonging to John King were sold between 6 December and 8 December.
Meanwhile, shareholders are urged to exercise caution as the company finalises a sell-back agreement to unwind its acquisition of Grid Control Technologies, Forensic Data Analysts and Investigative Software Solutions, which it acquired in November 2015.
EOH had been in discussions with the previous shareholders of these companies, which failed to achieve against their performance warranties.
In view of allegations against a shareholder, EOH has appointed Edward Nathan Sonnenbergs to conduct a full fact-finding review of the commercial activities of the companies.