Portfolio Update: Big Technologies
I wrote a short update a couple of weeks ago about Big Technologies and the suspension of their CEO, Sara Murray. Since then, the company has released several more updates.
Big is currently being sued by a group of five former shareholders, including a former board member. It is alleged that Murray had undisclosed connections to a group of offshore companies and used them to push minority shareholders out at much lower valuations. The Guernsey based companies in question are called Zinc Limited, Romelle Limited, RCP Limited and Monitoring Partners Limited, and at one point owned nearly half of Buddi. The largest of these three, RCP, Monitoring Partners and Zinc sold 56.3 million shares at IPO, worth close to £112.6 million.
Big’s released another update on the 31st of March, announcing that Sara Murray’s appointment as CEO had been terminated and that the group had begun legal proceedings against her. According to their research Murray has or had undisclosed interests in the companies mentioned above at the time of IPO, failing to disclose them to the company. She also lied to the board in the context of the litigation and used the relationships with the offshore companies to extract significant sums of money from the business.
If the allegations do turn out to be true (which now seems very likely), then Murray’s actual shareholding is likely to be significantly above her official holding of 26.8%. The four offshore companies mentioned above owned 17.7% of shares pre-IPO and roughly 17.3% of shares after. This could push Murray’s actual shareholding above 30% and put the company in breach of rule 9 of the takeover code. Big has since notified the matter to The Panel on Takeovers and Mergers.
More recently, the company has announced further changes to the leadership team and board of directors. Mike Johns has joined as new CFO and Alexander Brennan has been appointed as the new charman, having been interim chairman since July 2024. The company has also appointed Ian Johnson to the board following discussions with Harwood Capital, who had consulted with other significant shareholders on the matter.
The implications of the litigation for Big and current shareholders are still somewhat unclear. Given that Murray’s actions put her in breach of the Companies Act 2006, she is personally liable for losses incurred by the company. It is likely, however, to be a long and protracted process, but I will hold tight for the time being.
In other news, and to complete the rollercoaster of emotions involved with owning the stock, Big announced that it had won a new contract. The contract is with the Department of Justice and is to provide monitoring services in Northern Ireland. The expected value for the 10-year period is £20 million.