SEATTLE-based investor Archon Capital Management has now sold its remaining 4.18% stake in IndigoVision as the battle for control of the Scottish video-over-internet com-pany continues.
Former IndigoVision chief executive Oliver Vellacott, who in November made three unsuccessful pitches for a management buy-out of the business, is now trying to oust chairman Hamish Grossart. IndigoVision announced the departure of founder Mr Vellacott on December 9, with the former chief executive declaring he had been dismissed and Mr Grossart disputing this assertion.
A statement to the stock market yesterday revealed Archon completed its exit from IndigoVision on Tuesday by selling its remaining 315,553 shares for a sum likely to have been around £830,000. Archon had sold 6.63% of the company to Glasgow-based Scottish Equity Partners, a supporter of Mr Vellacott, last Friday for a sum which is likely to have exceeded £1.25m.
The buyer of the 315,553 shares did not emerge yesterday through stock market notifications.
It appears most likely they have been bought by an institutional investor. SEP chose to buy only part of the Archon stake; Mr Vellacott has been sitting tight at 22.9%; and Mr Grossart, although he has been buying up shares, has not been making purchases on the scale of the disposals by Archon.
IndigoVision's shares surged a further 17.5p or 6.14% to 302.5p yesterday, raising its stock market worth by £1.32m to £22.8m.
The revelation of SEP's stakebuilding, which came on Wednesday, is likely to be taken as a signal that it stands ready to help fund a takeover bid for Indigo-Vision by Mr Vellacott.
SEP said on Wednesday it had acquired its stake through a company called Kuiper Limited, which it is believed is owned by one of its funds. Kuiper appears to have been set up through Scottish law firm Maclay Murray & Spens, and was incorporated on August 30. The timing and nature of its incorporation, given that it coincides with a period in which Mr Vellacott would likely have been considering and weighing up funding options for a buy-out of IndigoVision, suggests it may have been set up as a special purpose vehicle with a view to a bid for IndigoVision.
SEP is a private equity house which puts up medium or long-term funding to back those who run businesses, as opposed to the type of investor which might speculate in the shares of a publicly quoted company for short-term gain.
Mr Grossart told The Herald last Friday that he had received three management buy-out proposals from Mr Vellacott that would have taken the company private, valuing it at 225p, 248p and 265p-a-share. With Indigo-Vision shares having surged from Tuesday's 262.5p close in the last two sessions, they were last night significantly higher than Mr Vellacott's third approach of 265p.
IndigoVision revealed on December 13 that Mr Vellacott had requisitioned a general meeting to vote on resolutions to remove Mr Grossart and non-executive director and former Scottish Conservative party chairman Andrew Fulton from the board. Mr Vellacott is seeking election to the board with allies Sir Peter Burt, former chief executive of Bank of Scotland, and Waverley Cameron, a member of the Edinburgh stationery dynasty.
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