MATTHEW PERRIN, the young gun chief executive of surfwear outfit Billabong International, has sold more than half his stake in the company he helped float, raising a tidy $66 million.
Shares in the company, which ended 14¢ weaker yesterday at $8.96, are expected to come under severe pressure today. For right or wrong, many investors interpret sales by executives who run the business, and know it better than anyone, as a sign of the company's prospects.
Macquarie Equities was offering eight million of Mr Perrin's shares to major institutions last night at $8.30 apiece. Several fund managers expressed caution about buying such a big stake from a key cog in the management team.
One suggested the sale of $1 million worth of stock "for a house or something" was acceptable. But $66.4 million was a bit rich.
An investor who bought a line of three million shares early yesterday for $9.05 each through Merrill Lynch has every right to be particularly aggrieved. The buyer could have picked up stock far more cheaply in the afternoon, and now faces a slump in the shares today.
Mr Perrin wasn't immediately available for comment.
Only last week, Mr Perrin, 30, unveiled a 45 per cent increase in net profit for 2001-02 to $61.1 million. He spoke of strong momentum across the company and forecast net profit growth for 2002-03 of "25 per cent or more" on the back of trading in Europe and the US.
The sale, which was due for completion late last night, will leave Mr Perrin with about 5.1 million shares, or about 2.6 per cent of Billabong.
Mr Perrin came to prominence by steering Billabong to a $600 million float in August 2000. It is now worth nearly three times that amount.
