Manulife poised for $100-million-plus windfall on DNDTo understand the Jan 05, 2021 secondary bought offering...here is what it means...
- institutional investors and large shareholders use this technique to buy and sell big block of shares which may not always be possible in open market
- usually done through an underwriter that matches buyer and seller
- Nothing wrong to cash in or lock in some gains
- the CEO is also selling some shares...normal...as he still has tons of shares...people use proceeds in their personal lives for personal consumption
- Divesting shareholders still hold massive amount of shares in DND
- Manulfe is still holding 60% of its investment in DND (that's confidence)
- Manulife clients are buying shares of DND
- if 4 million shares are being swapped...this means other new or existing institutional investors can get a substantial amount of shares bought this way
- this is very positive as DND is held by more shareholders
- after Jan 08 2021 over allotment clause ends and...i see big $$$$ ahead
Globe & Mail...Jan 06, 2021
Manulife Financial Corp. has begun cashing in what is likely to be a nine-figure windfall from its private investment in legal software consolidator Dye & Durham Ltd. less than three years ago.
The financial services giant’s private equity arm, Manulife Capital, invested $15-million in Dye & Durham in April, 2018, several months before D&D’s first, aborted IPO. When it did finally go public last July at $7.50 a share, Manulife’s 3,733,156-share stake was worth $28-million.
Since then, the stock has taken off, partly due to heavy demand for tech stocks during the pandemic, as well as strong investor support for D&D’s consolidation plan, which involves buying up other providers of legal software and services and jacking up prices by 15 per cent to 20 per cent. The stock shot up 27 per cent on Dec. 10 when D&D announced it would buy DoPorocess LP, Canada’s largest provider of real estate practice management software, for $530-million, its biggest deal to date.
The stock has since traded consistently above $40 a share and as high as $53.68, giving D&D a market capitalization of more than $2.7-billion.
Earlier this week it announced that six shareholders, including chief executive Matthew Proud, would sell a combined 4.1 million shares in a $175-million bought deal underwritten by Canaccord Genuity.
Manulife Capital is one of the divesting shareholders. It is selling 1.52 million shares, or 40 per cent of its stake, for gross proceeds of $65-million, less a 3.75-per-cent commission. That leaves Manulife with another 2,213,156 shares, worth more than $95-million at Wednesday’s closing price.
Even if its remaining stock had no value, Manulife would have already quadrupled its investment in just less than three years. It is poised to do far better than that, with paper holdings and share sale proceeds that now represent a tenfold return on its initial investment.
Meanwhile, other parts of the vast Manulife empire have bought into the D&D story, with other funds or client accounts buying a combined 2.64 million shares last August and November, according to filings with regulators.