By Steve Moore | Saturday 17 June 2017
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from ShareProphets). I have no business relationship with any company whose stock is mentioned in this article.
I previously wrote on restaurant group Richoux (RIC) in April, with the shares at 20p, concluding that there looks much turnaround work to do in an admitted “difficult” period for the sector and with it also placing ahoy, I avoid. The company has now made a “Completion of Subscription & Director Transactions” announcement.
This reports that it has raised £4 million at 16p per share, including CEO Jonathan Kaye taking £0.5 million of the subscription, other Kaye family members £0.9 million and other directors £1.5 million.
This follows the appointment of Jonathan Kaye in October and the shares then crashing from above 25p on the results announcement for the company’s year ended 25th December 2016. They were 19p on the announcement of the subscription, with the subscription proceeds to “be used for general working capital purposes”.
It’s thus discounted shares for the management, but new funds were clearly needed and at least they’ve significant ‘skin in the game’. However, the April results announcement made it clear that there was much turnaround work to do – and there’s continuing evidence that the sector is facing quite a storm.
I’ll continue to monitor the progress of this ex-Prezzo management here with interest, but currently will certainly be continuing to avoid the shares.
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