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Directors’ Deals: Tristel chief sells £1mn shares to buy property

Logic would suggest that the makers of disinfectant products were able to benefit from the Covid-19 pandemic in a way that other businesses could not. This, however, was not entirely the case for Cambridgeshire-based Tristel, which makes products for sanitising medical instruments.

While sales of surface disinfectants went up, sales of medical device decontamination solutions dropped. Tristel’s fortunes started picking up this year, though, and it announced this month that it expects its annual profit and revenue figures to meet expectations. It plans to offer shareholders a special dividend of 3p per share. It also expects to declare a final dividend of 3.93p – in line with last year’s payout – when it announces full-year results in October.

Tristel’s business has gained from the well-documented backlog of medical procedures that clinicians around the world are working to address.

“Hospitals worldwide are gradually returning to normal levels of service, which for Tristel means an increasing number of diagnostic procedures, each requiring a disinfection event,” the company’s chief executive, Paul Swinney, said. “During the year 15.7mn disinfection events took place with a Tristel medical device disinfectant, which is 31 per cent higher than in the year ended 30 June 2019.”

It was also revealed last week that Swinney sold almost £1mn worth of shares to fund a property purchase. He sold 300,000 shares at 333p, leaving him with 412,350 shares, or a stake of about 0.9 per cent. Swinney is the co-founder and an original shareholder of Tristel and has been its chief executive since its flotation on AIM in 2005.

The shares closed around 5 per cent lower on the day of the announcement at 338p.

When contacted by the IC, a spokesperson confirmed the share sale was to fund a property purchase and was “in no way a reflection of the expected future performance of the business”.

Domino’s India partner takes slice of Eurasian operator

Russia and Turkey might not currently look like the most attractive markets in the world, particularly when it comes to consumer spending. 

Yet DP Eurasia, the London-listed company which holds the master franchise for Domino’s Pizza in both countries (as well as Azerbaijan and Georgia) has witnessed sustained buying of its shares in recent weeks by a subsidiary of Jubilant Bhartia. It is the master franchisee for Domino’s in India, Sri Lanka, Bangladesh and Nepal.

It had built a 33 per cent stake in DP Eurasia by the end of September last year, when it announced a reverse bookbuild with a view to increasing its holding to 49.99 per cent. 

It offered 95p a share — a premium of about 23 per cent on the previous day’s closing price.

DP Eurasia, which is based in the Netherlands, is not subject either to UK or Dutch takeover rules so its directors were not obliged to give a view on the offer, but an independent committee flagged risks and said the deal should be viewed as a “change of control” transaction given the influence Jubilant would have on the business. If Jubilant’s stake rose above 50 per cent, there was nothing to stop it from delisting the company, the committee said.

Jubilant, whose sibling co-founders Shyam and Hari Bhartia sit on DP Eurasia’s board, only managed to secure about 40 per cent of the shares by the end of the process, but given the subsequent decline in the company’s value, some investors will be ruing their reticence. 

DP Eurasia limited any further investment into Russia after sanctions were imposed in March and in Turkey it is grappling with an annual inflation rate of 79 per cent. 

Still, a first-half trading update last week showed like-for-like sales growth of 38.6 per cent and the company said adjusted cash profit this year is likely to be above consensus forecasts.

DP Eurasia’s shares have fallen in value by about a third since the start of this year and the Bhartia brothers have continued to buy, with their most recent purchase bringing Jubilant’s stake to 44.75 per cent. 

Minority shareholders now have more protection, though. Following a vote at DP Eurasia’s AGM in April, any investor whose stake grows beyond 50 per cent is obliged to submit a mandatory offer for the remaining shares.

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