Sorrell and co-investors make £38m on launching S4 Capital on stock market

BLOCKLEY, U.K. - Sept. 28, 2018 - PRLog -- Sir Martin Sorrell and his fellow investors who set up his new marketing venture S⁴ Capital in May this year have made a paper gain of almost £38 million before any material period of trading has taken place under the new management of that company and its first acquisition – MediaMonks Multimedia Holding.

That represents a gain of 74% on their initial £51 million investment – equivalent to acquiring their shares in the public company at a 43% discount.

The paper gain arose after the exchange of their S⁴ Capital shares for shares in the publicly listed Derriston Capital was approved by shareholders yesterday and trading in Derriston shares was restored this morning.

Derriston has now adopted the S⁴ Capital name and its shares were trading at 150p when the stock market opened this morning, valuing the group at £383 million.  The price slipped back a little later and may move up or down before the shareholders are in a position to sell any of their shares.

The prospect of a substantial gain was first highlighted in Marketing Services Financial Intelligence in May (visit http://www.fintellect.com/msfi for details).

The gain was achieved because the terms of issue of the initial shares in S⁴ Capital to Sorrell,  associates and institutions included a commitment to exchange those shares for a predetermined number of shares in Derriston.  Those terms virtually guaranteed a healthy initial paper gain.

"It is not clear why Derriston's existing independent shareholders would have voted for such a reward arrangement before S⁴ Capital had made a material profit under its new management and so soon after the MediaMonks acquisition", commented editor Bob Willott.  "The probability is that they preferred to risk their capital under Sir Martin's leadership than to continue with the status quo."

ENDS