Carphone shares face uncertainty as investor lock-in expires

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The Independent Online

Carphone Warehouse's shares will enter an uncertain period on Monday when more than 10,000 retail investors will be free to sell their holdings for the first time since the company's flotation in July.

Carphone Warehouse's shares will enter an uncertain period on Monday when more than 10,000 retail investors will be free to sell their holdings for the first time since the company's flotation in July.

The 10,300 investors may want to cut their losses on shares that were issued at 200p in the IPO, but closed last night up half a penny on the day at 155p. Investors are able to sell the shares because an agreed three-month lock-in period comes to an end today. Since the flotation, the shares have been caught up in decline in both the retail and telecoms sectors.

The leading mobile phone retailer, founded by chairman and chief executive Charles Dunstone, allocated 7 per cent of its shares to retail investors in an unprecedented arrangement that offered a full allocation of shares in return for investors agreeing to a lock-in period.

The scheme was instigated to avoid large numbers of shares being sold on the first day of trading. Mr Dunstone, with 38 per cent of the company, and other directors are still covered by a one-year lock-in.

Despite the share price slide, analysts predict a bright future for Carphone Warehouse and yesterday said it would be unwise for retail investors to sell their shares.

Nick Bubb, an analyst at SG Securities, said: "The future is looking good. There are likely to be more upsides than downsides."

Mr Bubb also forecast that the company's first interim results, on 6 November, would encourage investors in terms of the business's overseas expansion, and continuing appetite for mobile phones in the UK.

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