The Pushpay Holdings Ltd (ASX: PPH) share price won't be going anywhere today after the payments company requested a trading halt this morning.
Why is the Pushpay share price in a trading halt?
Pushpay requested the trading halt whilst it undertakes a fully underwritten bookbuild to facilitate a partial sell down of shares held by Chris Heaslip.
Mr Heaslip is the company's co-founder and non-executive director. He resigned from his position as chief executive officer in May.
The release explains that the partial sell down will involve a bookbuild to allow the sale of 12.24 million fully paid ordinary shares in Pushpay (the equivalent of 4.45% of the company's issued capital), representing 41.2% of the ordinary shares held by interests associated with Chris Heaslip.
The underwritten floor price is NZ$3.70 per share, which represents a 3.6% discount to the 5-day VWAP and a 2.4% discount to last traded price.
No reason has been given for the sale, but the company believes the sell down will provide further free float and liquidity to support Pushpay's index weightings.
Pushpay has explained that the remaining interests associated with Chris Heaslip have entered into an escrow deed, under which they are restricted from selling, or otherwise disposing of their remaining holding for an 18-month period from the date of settlement of this transaction.
Guidance reiterated.
As well as announcing the sell down, the company provided an update on its expectations for FY 2020.
According to the release, its guidance for the year ahead remains unchanged. Management expects annual operating revenue of between US$122.5 million and US$125.5 million, a gross margin of over 63%, EBITDAF of between US$18.5 million and US$20.5 million, and Total Processing Volume of between US$4.8 billion and US$5 billion.
Pushpay isn't the only tech company which has seen a founder or co-founder sell shares recently.
The founders of both Afterpay Touch Group Ltd (ASX: APT) and Xero Limited (ASX: XRO) have been selling shares on-market in recent months.
