SMCP Founders' Trading Mandate: A Blend of Caution and Opportunity

In a recent announcement, the founders of SMCP (Société Maje Club Paris), Mrs Evelyne Chétrite, Mrs Judith Milgrom, and Mr Ilan Chétrite, have entrusted an independent investment services provider with a programmed trading mandate. This mandate involves the sale of up to 1,872,539 ordinary shares resulting from the conversion of their class G preferred shares, with the sale set to take place between March 3, 2025, and December 31, 2025. The founders have expressed their commitment to the company and their intention to reinvest a significant part of the net proceeds from this sale into SMCP shares.

The programmed trading mandate by SMCP's founders is expected to have both short-term and long-term impacts on the company's share price and market sentiment. In the short term, the announcement of the sale of a significant number of shares by the founders may negatively impact the share price due to increased supply in the market. This could lead to a decrease in the share price as investors may sell their shares to avoid potential losses. However, the founders' decision to reinvest a significant portion of the proceeds into SMCP shares signals their confidence in the company's future prospects, which could mitigate the negative impact on the share price.

In the long term, the sale of shares by the founders may have a more positive impact on the company's market sentiment. The founders' reinvestment plan demonstrates their commitment to SMCP's long-term success and their confidence in the company's growth prospects. This could lead to an increase in investor confidence and a potential rise in the share price over time. Additionally, the sale of shares by the founders may help to distribute ownership more widely among investors, which could lead to a more stable and diversified shareholder base.

The potential tax implications for the founders and the company as a result of the sale of the converted ordinary shares include capital gains tax, dividend tax, corporate tax, withholding tax, and the potential application of double taxation treaties. The specific tax rates and rules would need to be reviewed based on the founders' and the company's tax residency and the applicable tax treaties.

The reinvestment of a significant part of the net proceeds from the sale into SMCP shares by the founders can positively influence the company's financial health and growth prospects in several ways. By increasing the company's share capital and liquidity, enhancing its financial strength, supporting growth and market share, aligning interests, and promoting sustainability, the founders' reinvestment plan can help SMCP navigate challenging economic conditions more effectively and achieve long-term success.

In conclusion, the programmed trading mandate by SMCP's founders is expected to have a mixed impact on the company's share price and market sentiment in the short term, with potential long-term benefits if the founders' reinvestment plans materialize. The potential tax implications and the positive influence of the founders' reinvestment on the company's financial health and growth prospects should be carefully considered by investors when evaluating the impact of this mandate on SMCP's future prospects.