Insider: Rolls-Royce among three big FTSE 100 trades

There's a lot of money sloshing around at the moment. Two directors have been buying big, but one FTSE 100 exec just made a £42k sale. 

The private equity boss behind some of the European deals that have propelled 3i Group (LSE:III) shares to record levels, has placed big bets on the FTSE 100-listed company's continued progress.

Pieter de Jong, who has been with 3i since 2004 and worked on the company's now hugely significant backing of fast-growing Dutch discount retailer Action in 2011, bought 3i shares worth £1.2 million in conjunction with a related person last week.

The two purchases of 50,000 shares were struck at prices of 1,272p and 1,281p. They took place after 3i had staged a capital markets event in which it revealed its private equity and infrastructure divisions continued to make good progress over the summer.

Shares closed last week at 1,281p, which compares with the record high of 1,339p seen last month and net asset value per share of 1,063p reported at its last trading update in July.

Well-known private equity investments include Danish furniture chain BoConcept, low-cost gyms operator Basic-Fit and personal care and fragrances business Royal Sanders. But Action is the most significant, accounting for 44% of the portfolio at the end of June and performing well in Europe as lockdown restrictions have been eased.

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The retailer's sales so far in 2021 are over 20% ahead of last year at more than 4.5 billion euros (£3.8 billion), having opened in Italy for the first time as part of 150 new stores in Europe.

As well as working on the Action deal in 2011, de Jong oversaw 3i's investments into Benelux-based Basic-Fit and Preston business Royal Sanders in 2013 and 2018 respectively, and still serves on the boards of both companies.

The two businesses performed well in annual results in May, when 3i said Basic-Fit was well placed to benefit from an increased focus on health and wellbeing post Covid-19.

Despite the disruption caused by enforced club closures, and having declined to a share price low of €13.4 in April 2020, they rallied 116% to finish March at €32.85 and were at €42 on Friday.

Operating in private label and contract manufacturing, Royal Sanders has benefited from its defensive nature and captured a substantial share of the increase in demand for handwash and hand gels during the Covid-19 pandemic.

Growth of its customer base has led to significant earnings growth, whilst the buy-and-build acquisitions of Royal Herkel and Tunap Cosmetics were funded from its balance sheet.

The deals, alongside continued organic growth, helped Royal Sanders to double both its revenues and underlying earnings, with a dividend of £38 million paid to 3i in 2020.

Amsterdam-based De Jong has more than 25 years' experience in corporate finance, becoming managing director of 3i Benelux before his promotion to co-head of private equity and joining the executive committee in 2019.

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Other director deals in the FTSE 100 index last week included at investments and financial advice business Abrdn (LSE:ABDN), where finance director Stephanie Bruce bought shares worth £135,000 at a price of 255.65p each.

She joined the board in the summer of 2019 and is required to build up a shareholding equivalent to 300% of her £538,125 basic salary. Bruce's purchase was made in the wake of Abrdn shares falling 13% following the publication of half-year results in mid-August.

The figures — the first since the name change from Standard Life Aberdeen — showed 52% growth in adjusted operating profit and an unchanged full-year outlook.

Now a more simplified business, Abrdn's chief executive Stephen Bird said net inflows in the “three growth vectors” of investments, advice and discretionary fund management offered encouragement. However, he noted there was still “considerable room for improvement”, particularly in terms of delivering a consistent investment performance.

Director dealings in Rolls-Royce (LSE:RR.) shares also took place last week, with the chief executive of the company's power systems business opting to sell shares on Wednesday at 140p.

Andreas Schell's move follows a strong run for the FTSE 100-listed stock, having risen by a third over the past fortnight, as the imminent re-opening of key transatlantic routes boosts hopes for an acceleration in engine flying hours.

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The balance sheet is also being bolstered after last Monday's signing of a deal to sell components supplier ITP Aero to Bain Capital for €1.7 billion (£1.45 billion).

Schell, a German citizen who started his role in January 2017 after working previously at UTC Aerospace Systems, raised £42,000 from the disposal of 30,000 shares at a price just above 140p. Rolls shares closed last week at 142.88p.