Two agents have complained that they have been kept in the dark about their share certificates for OnTheMarket – and effectively prevented them from cashing in their holdings quickly.
OnTheMarket has totally denied with-holding any information from its members, saying it has consistently kept them updates.
The agents have businesses in different parts of the country and each approached EYE independently.
Both had wanted to sell their shares as soon as trading started last Friday, as both foresaw major price drops.
However, both say they have since been told they will need their share certificates to sell – and those certificates will take 14 days to come through.
One said he is considering a complaint to the London Stock Exchange.
He told EYE he had never been told how many shares he had, and nor had he been given information about share certificates.
He said he had spoken to the company which took over from Capita last year, Link Market Services, and which is now responsible for that part of the service.
“I asked about my share certificates and how many shares I had, but because I don’t have any share certificates, I was told I could not be authenticated,” the agent told us.
He said that he has now learned what his shareholding is, but that he will need the certificates in order to sell any shares.
That would mean a 14-day delay.
He said that while he was one of the original shareholders, he had refused to sign up to the lock-in clause which allows agents to sell only 10% of their stock.
He said: “That doesn’t apply to me. As far as I am concerned, I could sell the whole lot.”
The other agent did know what his shareholding was, after notification in a letter dated last September 12.
He has under 5,000 shares, paying a monthly subscription rate to OTM of £50, and says the lock-in clause does not apply.
He claimed that at no stage had he been given information about his share certificate.
He said that after trading started last Friday, he rang OnTheMarket but was initially told the department concerned was not available to deal with enquiries.
He says he subsequently did get through and was advised of the 14-day wait.
He said that as soon as trading opened, he could anticipate the share prices going down – as happened.
He said: “By the time the stock market opened and my managing to get through to OnTheMarket, I had lost about £600.”
Both agents say they are very angry.
We put their points to OnTheMarket, where a spokesperson told us: “The company has consistently kept all member agents updated throughout the process leading up to the Admission of OnTheMarket plc to the AIM market of the London Stock Exchange.
“It was explicit within the Members Scheme documentation that all share certificates would be held by OnTheMarket and dispatched within 14 days of a written request from an agent, provided that those shares would not be subject to the terms of an agreed lock-in.
“If any agents have any queries on this matter, they should address them directly with OnTheMarket.”
Yesterday’s the share price actually picked up a little, ending the day at 142.5p, although down from their issue price last Friday of 165p.
It has also been announced that Schroders now hold a 6% stake in the company, holding 3.6m shares out of the 60.5m issued.
Separately, OnTheMarket’s big wins, Chancellors, Arun Estates and Hunters, this morning it was announced that Arun’s properties are now on the portal. It means that 100-plus branches are added to OTM’s inventory.
David Lench, Arun Estates Group Managing Director, said: “I believe that both agents and the property-seeking public will benefit from greater competition in the portal space and that a strongly funded agent-backed model is the most effective way to achieve it.
“I am delighted to declare the support of Arun Estates for OnTheMarket and to announce our strategic partnership commitment.”
Ian Springett, chief executive of OnTheMarket, said: “It is a powerful boost to OnTheMarket that Arun Estates is committing to list its properties for five years at OnTheMarket.com
“Arun Estates is undoubtedly one of the leading, most successful agent groups in the regions where it operates and its support will substantially strengthen our position in the market.”
The long-term listing agreements with Arun, Chancellors and Hunters Property Group Limited were conditional upon admission to AIM. The announcement about Arun suggests that Chancellors and Hunters’ outlets will also shortly be listing properties on OTM, giving a major boost to total property inventory.