Bidstack stays silent as investor anger grows over pre-pack administration deal

The bosses of in-game advertising firm Bidstack have remained silent since buying the AIM-listed firm out of administration last month, fuelling anger among retail investors. 

Questions continue to swirl about the deal, which saw chief executive James Draper and the firm’s other top brass suddenly by the firm as part of a pre-pack administration deal on March 22. 

Retail investors continue to demand more information about what happened, after the firm failed to find a buyer, despite Alvarez & Marsal prospecting as many as 200 firms for a potential take over and investment, and being in receipt of a recent EUR 3m court settlement. 

The value of the pre-pack deal has not been disclosed. 

Bidstack has not responded to multiple requests for comment. Alvarez & Marsal declined to comment. 

Its former major shareholders also continue to remain tight-lipped about what has happened to their investments in the firm. 

Cybersecurity firm Irdeto was the firm’s largest individual shareholder, which held a 13.49 per cent stake in the firm as of January 31, according to Bidstack’s website. Irdeto invested £6m in the firm as part of a funding round in 2022. 

Canaccord Genuity Group, Seneca Partners and Rathbone Investment Management, all held stakes of 9.64 per cent, 4.83 per cent and 4.28 per cent respectively. 

None of them responded to repeated requests for comment. 

City PM understands, however, Rathbone holds the stock on behalf of individual portfolios. 

Meanwhile, burnt retail investors have since banded together to create the Bidstack Shareholders Alliance, as they plough ahead with plans to take legal action and file regulatory complaints. 

Sheryl Cuisia, chief of The Engagement Appeal, a social enterprise that works to improve corporate engagement with investors, said her group has been supporting the retail shareholders, adding that she believed bosses were looking to ride out the anger from investors. 

“[Management’s] behaviour is largely to do with the mindset of ‘it’s just retail investors’. Their view is that a group like this will exhaust themselves. If it was Hargreave Hale or Seneca picking up the phone to them, they’d be answering,” Cuisia told City PM 

Meanwhile, many more out-of-pocket investors continue to come forward to express their frustration at what has happened. 

Malcolm Rogers, a retail investor from Hampshire, told City PM he was shocked at the “astonishing” demise and rebirth of Bidstack. 

“I was a private investor, to the tune of £3,700,” Rogers, 59, said, explaining the sum was part of his self-invested pension plan. 

“I first invested in Jan 2021, because having worked in the consumer/experience side of IT for over 20 years. Bidstack looked to be – and I believe still is – a very exciting proposition,” he added. 

However, his feeling towards the company has changed following the “out-of-the-blue insolvency”.

Another investor, Simon Cooper, 54, from Hove, told City PM he was furious about how the firm had treated shareholders. 

Cooper said: “AIM has a large base of private investors who invest for the long term, yet James Draper showed he despised us.”

Write to Ben Lucas at [email protected] and Charlie Conchie at [email protected]