Kogan and Shafer Sell $40m of Shares

Natasha Sholl By Natasha Sholl | 04 Sep 2018

Kogan’s founding directors, Ruslan Kogan and David Shafer, have cashed in $40 million of their shares and the market has responded accordingly.

In an ASX announcement this morning, Kogan.com confirmed the sale of 6.25 million shares overnight by Russian Kogan and David Shafer. Predictably, the share price has slumped, falling 60 cents or 8.5 percent to $6.43. The transaction, valued at approximately $40 million, reportedly completes the current intention to trade by the founding directors. They have advised that they have no intention to sell any securities prior to the release of the first half 2019 results.

“It is great to see our work at Kogan.com continue to attract significant interest from both domestic and international shareholders who value our business strategy and execution,” Chairman Greg Ridder said in the announcement. “All shareholders will have the benefit of added depth and liquidity afforded by this transaction while maintaining our founders, Ruslan Kogan and David Shafer, interests in the Company at proportions amongst the highest on the ASX.”

The announcement further claimed that the directors remain “fully committed” to the business and continue to have their personal wealth invested in the company.

Kogan’s share price plummeted in June this year after a failed attempt to sell $100 million worth of shares. A few days later, there was further backlash after Kogan and Shafer “reluctantly” sold 6 million shares due to “personal financial commitments.” Just prior to the June sale (reportedly worth $42 million), Kogan had announced its plans to enter the whitegoods market, causing shares to soar, before the announcement of share sales caused prices to plummet.

This latest announcement follows a similar pattern, with Kogan announcing its entry into the financial products realm with the launch of Kogan Money just yesterday. Shares went up after the Kogan Money announcement (by 2.3% in early trade to $7.11 and closing at $7.03) yet dropped dramatically within 24 hours after the announcement of the directors offloading a substantial number of their shares.

Kogan already reduced his stake in the company by $50 million in shares via Canaccord Genuity to institutional investors in February this year. The February sale came after both Kogan and Shafer sold a $20 million stake for $3 a share in August 2017, and a further $23 million at $4.25 a share in October 2017.

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