One can only assume that Fran Rooney, Henry Beker and their fellow Baltimore directors had a real need for the £12 million sterling (€19.8 million) worth of Baltimore shares they unloaded this week because that share sale has sent all the wrong signals to the market a matter of weeks before Baltimore's membership of the FTSE-100 index comes up for review.
Of course, Rooney and his colleagues were in a closed period ahead of the recent results and could not sell any shares. But the bald facts are that, having being restricted from selling when the shares hit a £15 high a few months ago, Messrs Rooney, Beker et al have sold into a weak market.
By selling at this price, the directors are signalling that there are better homes for their money other than in Baltimore shares. And by locking in profits at £5.80 each, they are also giving a signal that they don't expect the share to rise in the short to medium term. In that assumption, they are probably right as the shares had fallen back to £5.19 as this column was being prepared.
Incidentally, why does Fran Rooney feel the need to hold his Baltimore shares in such a convoluted manner - held through a Madeiran paper company which is controlled by a Cypriot trust of which Rooney and his family are beneficiaries?
Baltimore's supporters might say that Fran Rooney still has over six million shares and Henry Beker 4.4 million shares, and still have a strong vested interest in the company prospering and the share price improving. But bar a miracle, Baltimore is set to have a short life as a Footsie member and will exit the index in mid-June.
That means there will be little support for the shares ahead of the Footsie rejig as the index funds who bought ahead of the inclusion last March will now be sellers ahead of the share's likely removal from the index. Incidentally, that share sale by the Baltimore directors took place the same day as Nomura produced a report which, in effect, stated that the potential market for e-commerce security products has been overstated and that Baltimore shares would fall over the summer months.
