If, like me, you were wondering who picked up the 12 million shares of iProperty Group Ltd (Public, ASX:IPP) the founders recently sold, the answer arrived today in an ASX announcement.
SeLoger.com the privately held French property portal company paid $1.05 per share. The $12.6m purchase increased SeLodger's holding by almost 7 per cent, from 9.4% to 16.1%.
IProperty Group's founders, Lucas Elliot and Patrick Grove, still own 41 million shares, valued at just over $43 million via their Malaysian based company Catcha Group.
Despite being the number one property portal in Asia, iProperty Group remains a loss making company. In its most recent quarter this fledging company burnt through $2 million in cash. That leaves a mere $6.5 million of cash on the balance sheet.
To be fair, the cash burn rate is not as bad as it seems at first glance. Around half of the cash was used in the acquisition of PT Web Marketing.
Disclosure: Dean Morel is long iProperty Group, but recommends you do what he says rather than what he does. Investing in loss making companies is highly speculative and Dean recommends waiting for earnings to appear prior to investing.