Lock-up expiries key to demand for IPOs this autumn

Some lock-ups are easier to prise open than others. In reality TV series Storage Hunters, bargain seekers use bolt cutters to bust into old garages. But forced entries are frowned on in the stock market. Here, a slew of dominant shareholders have been constrained from selling shares in companies that floated earlier this year.

That is about to change. Lock-up periods for 23 main market businesses expire between now and Christmas, according to data compiled by Numis. The phenomenon will complicate the deliberations of this autumn's debutantes over likely demand for their own shares.

The total value of equity that big investors will be able to sell is about £8.5bn at current prices. That is a decent sum compared with £11bn raised from new equity this spring and summer

Original investors in float companies typically agree to unload no more shares for 180 days to avoid depressing prices. But self-denial has failed to support the stocks of eight of the companies.

Disposing of big holdings in businesses whose shares have fallen against their IPO prices, such as Pets at Home, would be challenging. But the value of stakes in companies that have beaten their float prices still stands at a healthy £6bn.

That does not mean all owners will take the bait. For example, media group Daily Mail and General Trust is likely to hang on to its 28.6 per cent stake in property website Zoopla. Private equity owners will be more inclined to reduce exposures.

Lock-up periods can be less reliable than purchasers of IPOs or placings often believe. In May 2013, Lloyds annoyed fund managers by wielding the bolt cutters. The bank activated a get-out clause to sell 15 per cent of wealth manager St James's Place before a standstill had expired.

No pre-IPO investor in a big market debutante has given in to equivalent unworthy temptations so far this year. Keep it up, you lot.

We can cross another name off the list of candidates to chair Barclays. Rona Fairhead, former chief executive of the Financial Times, will instead direct her piercing scrutiny at the BBC, whose governing trust she will chair. The news coincided with Sir Michael Rake, a one-time frontrunner, ruling himself out for a second time as he takes on the chairmanship of RAC.

You'd almost think some City grandees were nervous about leading a bank whose legacy issues entitle the chair to regular drubbings in the press and parliament.

The hard-nosed Sir Howard Davies may therefore be back on the radar. As if writing a wry column about business (for Management Today) somehow isn't enough to keep a person entertained, he chairs insurer Phoenix and advises the government on airport capacity. Sir Howard was mooted by headhunters early in the search for a successor to Sir David Walker, but has been less fancied lately.

Other dark horses include Tim Breedon. The former chief executive of Legal & General has that sense of social mission as necessary to modern bank bosses as the profit motive. Another wild card, Robin Budenberg, former boss of UK Financial Investments, is apparently not in the running.

Barclays watchers say that, given political sensitivities, the ideal candidate would be an Australian or Canadian ex-central banker, untarnished by the financial crisis, who is also female. Nothing like casting the net as wide as you can, eh?

Perform hasn't. Shares in the sports media group have been kicking around at 210p compared with a 2013 high of almost 600p.

Len Blavatnik is therefore doing other shareholders a favour by offering 260p per share - equivalent to a 24 per cent premium - for the 57.5 per cent of Perform he does not own. Or is he?

Apparently the US billionaire only wanted to increase his shareholding above 50 per cent by buying in the market. But those wild-eyed fundamentalists at the Takeover panel required him to make a full £702m takeover offer.

The panel must believe that Mr Blavatnik's sway on the business would be considerable if he achieved majority control. It would thus be fair for all minorities to receive a takeout offer at the same level.

Mr Blavatnik knows he needs acceptances equivalent to little more than 7.5 per cent of the equity to cross the 50 per cent threshold. Then an increase to 75 per cent followed by a delisting will be a fait accompli.

No rubber stamp from the board is needed. No higher offer, either.

The panel's judgment therefore apportions disadvantage with Solomonic even-handedness.

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