Multiple Blackstone Group (NYSE:BX) entities have collectively sold shares worth approximately $328.6 million in Gates Industrial Corp plc (NYSE:NYSE:GTES), according to recent filings with the U.S. Securities and Exchange Commission. The transactions, which took place on May 21, 2024, involved entities known as BX GATES ML-1 HOLDCO LLC, BX GATES ML-2 HOLDCO LLC, BX GATES ML-3 HOLDCO LLC, BX GATES ML-4 HOLDCO LLC, and BX GATES ML-5 HOLDCO LLC, all of which are affiliated with Blackstone Inc.
The sales were executed at a price of $16.33 per ordinary share, as indicated in the footnotes of the filing. This price represents the sale price per ordinary share in a secondary offering. The entities, which are reported as ten percent owners, sold varying amounts of shares, resulting in a significant reduction of their holdings in Gates Industrial Corp.
Specifically, BX GATES ML-1 HOLDCO LLC and BX GATES ML-2 HOLDCO LLC disposed of 9,060,258 and 8,760,958 ordinary shares respectively. BX GATES ML-3 HOLDCO LLC sold a smaller amount of 29,998 shares, while BX GATES ML-4 HOLDCO LLC and BX GATES ML-5 HOLDCO LLC sold 1,847,949 and 425,837 shares respectively.
Following the transactions, the ownership stakes of the entities have decreased, but they continue to hold a significant number of shares in Gates Industrial Corp. The shares were held indirectly, with various layers of ownership detailed in the footnotes of the SEC filing. For instance, BX GATES ML-1 HOLDCO LLC's shares are held through Blackstone Capital Partners (Cayman) VI L.P., and BX GATES ML-2 HOLDCO LLC's shares are held through Blackstone GTS Co-Invest L.P.
The footnotes also clarify the complex ownership structures and disclaim beneficial ownership of the reported securities by each reporting entity, except to the extent of their pecuniary interest therein. The filings were signed by Christopher J. James, an officer of the reporting entities, on May 23, 2024.
Investors often monitor such filings to gauge the sentiment of major stakeholders in a company. The sale of a significant amount of shares by entities associated with a leading investment firm like Blackstone can be of particular interest to the market. Gates Industrial Corp, incorporated in England and Wales, operates in the general industrial machinery and equipment sector and is headquartered in Denver, Colorado.
InvestingPro Insights
In the wake of Blackstone Group's entities reducing their stake in Gates Industrial Corp plc (NYSE:GTES), investors may be seeking additional context to understand the company's current financial health and market position. According to InvestingPro, Gates Industrial has been exhibiting some noteworthy metrics and trends.
One of the key InvestingPro Data points is the company's Price/Earnings (P/E) Ratio, which stands at 18.94, with an adjusted P/E for the last twelve months as of Q1 2024 at 18.62. This suggests a moderate valuation level relative to its earnings. Moreover, Gates Industrial's Price/Earnings to Growth (PEG) Ratio for the same period is 0.97, indicating that the stock might be reasonably priced in terms of its expected growth. Additionally, the company has a Price to Book ratio of 1.44, which can be appealing to value investors seeking assets at prices close to their intrinsic value.
When it comes to performance, Gates Industrial has seen a substantial 1 Year Price Total Return of 53.08% as of May 2024, reflecting a strong return over the last year. This is complemented by a high 3 Month Price Total Return of 20.56%, showcasing robust short-term performance. Furthermore, the company's shares are trading near their 52-week high, at 97.77% of the peak price, signaling investor confidence.
InvestingPro Tips also highlight several strategic insights. Management's aggressive share buybacks indicate a belief in the company's value and a commitment to returning capital to shareholders. High shareholder yield is another positive sign, suggesting that investors could benefit from both capital gains and potential returns on their investment. It's worth noting that there are 13 additional InvestingPro Tips available, providing a deeper dive into Gates Industrial's financial health and market prospects.
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