Share Options and an IPO
Discussion
Hi all
I have an oppurtunity to purchase a number of shares in my employer at a fixed price. The company is currently listed on a local, non liquid exhange and the share price is currently 12p more than my options.
I envisage a listing on a major exhange in 3 years and I believe the target listing price to be over double maybe treble of my options and if looking at similar companies not in the same shape as us they listed at 6 X my option price.
If I excercise my options which I can do up until end of April 2019 I have certain conditions such as can only sell after certain periods. The first oppurtunity to sell would, in my belief, well after the IPO which I would not be in favour of.
What actually happens to shares in a company at an IPO. Do all shares take part, would I be blocked out of it due to my sale restrictions etc. I will be asking the right person in the company but would like to get my head around what happens to all shares when there is an IPO.
I have an oppurtunity to purchase a number of shares in my employer at a fixed price. The company is currently listed on a local, non liquid exhange and the share price is currently 12p more than my options.
I envisage a listing on a major exhange in 3 years and I believe the target listing price to be over double maybe treble of my options and if looking at similar companies not in the same shape as us they listed at 6 X my option price.
If I excercise my options which I can do up until end of April 2019 I have certain conditions such as can only sell after certain periods. The first oppurtunity to sell would, in my belief, well after the IPO which I would not be in favour of.
What actually happens to shares in a company at an IPO. Do all shares take part, would I be blocked out of it due to my sale restrictions etc. I will be asking the right person in the company but would like to get my head around what happens to all shares when there is an IPO.
Thanks, I do not plan on going "all in". It doesn't fit my portfolio as such or my attitude to risk as this is risky especially as it is a company I rely on to fund my living as well so if it goes tits up I have lost salary and investment money.
I have been told that I could in effect get shares for free by selling options at current market to then buy back at my option price but obviously am not permitted to sell all to buy a greater number back at the cheaper price i.e in terms of these option shares I cannot go above 56,250 shares in the total transaction relating to these options.
Would my math be correct and I sure it is not but I ask the trust to sell 54,044 of my options generating £83,227.76 at current market price of £1.52 per share. This then gives the trust a profit of £3,352.76 which I can then use to buy shares at my option price ensuring that I do not go over a total transaction of 56,250.
So I have worked out I could then ask the trust to buy 2,206 at £1.42 for a total of £3,152.52 bringing the total I have transacted to 56,250, and the trust has cash of £80,095.24 so has more money that the £79,875 I would have given it if I had bought all my options.
I really need to ping a mail to the CEO who is dealing with the options.
I have been told that I could in effect get shares for free by selling options at current market to then buy back at my option price but obviously am not permitted to sell all to buy a greater number back at the cheaper price i.e in terms of these option shares I cannot go above 56,250 shares in the total transaction relating to these options.
Would my math be correct and I sure it is not but I ask the trust to sell 54,044 of my options generating £83,227.76 at current market price of £1.52 per share. This then gives the trust a profit of £3,352.76 which I can then use to buy shares at my option price ensuring that I do not go over a total transaction of 56,250.
So I have worked out I could then ask the trust to buy 2,206 at £1.42 for a total of £3,152.52 bringing the total I have transacted to 56,250, and the trust has cash of £80,095.24 so has more money that the £79,875 I would have given it if I had bought all my options.
I really need to ping a mail to the CEO who is dealing with the options.
Thanks for the food for thought. Only one type of share so the filing ladies buying through the buy as you earn scheme and the CEO with his millions of shares all holds the same share with same rights to vote and divi.
I can now sell the options before buying them and then use than profit to buy my options so I will pick up about £4K worth for free at present, but I am not doing that until April as the projection is the share price should be +50p by then and if it is I will end up with more shares for free. This suits me and added to the shares I own already and my monthly purchase from the buy as you earn I am happy I have a hand in the pot should we list and will collect a repectable Divi once or twice a year.
I can now sell the options before buying them and then use than profit to buy my options so I will pick up about £4K worth for free at present, but I am not doing that until April as the projection is the share price should be +50p by then and if it is I will end up with more shares for free. This suits me and added to the shares I own already and my monthly purchase from the buy as you earn I am happy I have a hand in the pot should we list and will collect a repectable Divi once or twice a year.
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