February 14 2020 @ 9:45 by Richard Dawson
Shares in Sunderland sofa retailer ScS have risen after a major shareholder sold off its remaining stake, raising almost £22 million.
The shareholder in question, Parlour Products Holdings, has announced the sale of its remaining 9,853,024 ordinary shares, which represents approximately 25.92 per cent of the ScS share capital.
Parlour Products Holdings announced it was selling the shares on the stock market late on Monday 10 January, and shares were offered by way of an accelerated bookbuild, with Shore Capital Stockbrokers acting as sole bookrunner.
The sale comes three months after Parlour Products divested 15.5 per cent of shares, raising £13.8 million, bringing the total gross proceeds of the sale to approximately £21.7 million.
Following a stock market announcement stating that the seller no longer holds any shares in company, shares in ScS rose 2.14 per cent to £2.32.
Parlour Products Holdings — an affiliate of US buyout specialist Sun Capital Partners — originally prevented ScS from going into administration 12 years ago when it bought the sofa retailer for an undisclosed fee back in 2008, saving hundreds of jobs during the recession.
The sofa giant eventually returned to the Stock Exchange with a flotation in 2015, and its share price has risen steadily as the company has continued to grow.
News of the sale comes after a strong year for ScS, with full year trading figures showing it increased its sales by £5 million for the year ending July 2019.
During the same trading period, the company also reported a £300,000 boost to operating profit by around to £13.9 million.
Since the news was announced, Paul Daccus, Parlour Products’ representative on the ScS board, has stepped down as a director.
A spokesman for ScS said: “There has been strong institutional investor demand for ScS and as a result Sun, which has until now been the private equity backer of ScS since 2008, has sold its remaining stake in an accelerated bookbuild announced first thing this morning.
“From ScS viewpoint, the board thanks Sun European Partners LLP for their huge support over the past 12 years and welcomes the enlarged institutional shareholder base.”