Fronde’s shareholders have approved an issue of up to one million new shares to four senior managers in the IT services company.
The shares are being issued at a price of $0.67 to CEO Ian Clarke and members of Fronde’s senior management team who the company was not prepared to name. The managers will pay cash for the shares.
The shares issued are ordinary shares and rank alongside other issued shares in all respects, the company told
Computerworld this morning.
The issue will increase Fronde's shares on issue by 12.5% but will not result in any change in control of the company, Fronde says.
“The company directors are very supportive of management holdings in the company, both as a measure of belief and commitment and for the obvious alignment in business outcomes with shareholders’ expectations," says chairman Wayne Norrie.
"The management buy-in will provide a springboard to accelerate Fronde’s growth in two key areas: cloud computing in our partnership with Google, and also in mobility solutions. It will also assist in the development of additional strategic partnerships”.
Fronde shares have traded at a wide range of prices on the Unlisted market. The company says an independent valuation was carried out for the Fronde directors by BDO who valued the company between 64c and 68c per share.
Late last year,
Fronde reported a half year profit before interest and tax of $0.71 million, down from $1.05 million in the same period of 2008.
For the six months ended 30 September 2009, revenues was $12.6 million, down from $15.7 million for the same period in 2008 (
report pdf here).