Kogan’s Ruslan Kogan, David Shafer sell $42m worth of shares
Ruslan Kogan and CFO David Shafer “remain fully committed” to Kogan.com, after offloading six million of its shares.
Kogan.com founder Ruslan Kogan and chief financial officer David Shafer have “reluctantly” offloaded $42 million worth of the company’s shares, as the valuation of Mr Kogan’s once-infallible online retailer continues to fall.
The Australian’s DataRoom column today revealed online that investment bank UBS sold six million Kogan shares at $7 each. The company later confirmed the sale, saying Mr Kogan and his business partner Mr Shafer had received an unsolicited bid for six million shares and had “reluctantly accepted the bid due to personal financial commitments”.
It’s unclear who exactly bought the shares but if it is a single owner, their identity will have to be disclosed to the market within two days under ASX rules.
The share sale comes just a week after Mr Kogan and Mr Shafter copped investor backlash over an abandoned attempt to sell $100 million in company shares. Kogan.com’s (KGN) share price plummeted per cent from $9.80 to $8.10 last Friday.
“Mr Kogan and Mr Shafer remain fully committed to the business and continue to have the vast majority of their personal wealth invested in Kogan.com,” the retailer said in a statement to the ASX.
“Other than the trade outlined above, Mr Kogan and Mr Shafer will not be dealing in securities prior to September 2018.”
Mr Kogan declined to comment further
The company’s shares closed down almost 7 per cent to $7.31, giving it a market capitalisation of $685.62 million. That’s still multiples higher than when Kogan.com listed in July 2016 with a valuation of $168m.
The IPO two years ago marked the first time Kogan.com had received external funding.
The shedding of shares was somewhat of a distraction for Kogan, which today launched its “SmarterHome” range, which at first includes panel heaters but will eventually feature smart plugs, bulbs, portable air conditioners and other appliances.
The company has built an app to control the range from a smartphone, and the app can also control non-smart devices that are connected to a smartplug. For example, a heater can be set to be turned on automatically at specific times during the day or when a certain temperature is hit.
Mr Kogan told The Australian earlier this month his company is flexible about products it starts selling or kills off, given it’s a business entirely driven by consumer demand.
He started his company in 2006 selling just two television models, but Kogan.com now offers over 50,000 products including gym equipment and baby carriers.
“We don’t create demand, we service demand,” the CEO said. “If people are after smart home appliances then that’s what we’ll give them, at the best price in the market. We’ve noticed consumers generally are very interested in smart home enablement, people do want products in that space and it’s something we’ve been working on for a while now.”
Mr Kogan joked to The Australian at the CES technology show in Las Vegas earlier this year that his company is in fact a statistics business masquerading as an online retailer, adding his team is constantly monitoring website traffic and data like Google searches.
“We know exactly when our buyers should import fidget spinners and when we should start discounting them and never stock them again,” he said.
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