How much of Afterpay is still owned by its founders?
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Afterpay Ltd (ASX: APT) is still a widely followed ASX growth share, despite its impending exit from the ASX boards. Afterpay announced in August that is to be acquired by the US payments giant Square Inc (NYSE: SQ). Because of this, it’s been clear that investors will soon be unable to directly invest in Afterpay shares. Even so, this acquisition is scheduled to take place in 2022. So there’s still some time left for this company on the ASX.
But with this in mind, it might be a good time to check out how the share structure and ownership of this company is faring.
After all, Afterpay is one of the most prominent founder-led companies on the ASX. It was famously started by Nick Molnar and Anthony Eisen back in 2014, and is still headed by these gentlemen today. In fact, upon its acquisition by Square, Eisen and Molnar will both join the newly merged Afterpay/Square. Here’s what Afterpay said about the new role its two founders will be playing in the merged company:
Afterpay’s Co-Founders and Co-CEOs will join Square upon completion of the transaction and help lead Afterpay’s respective merchant and consumer businesses, as part of Square’s Seller and Cash App ecosystems. Square will appoint one Afterpay director as a member of the Square Board following closing.
How many Afterpay shares do its founders still own?
So Mr Eisen and Mr Molnar both still own substantial chunks of the company they founded. According to an ASX release from 30 August, Molnar still owns approximately 19.46 million Afterpay shares through various ownership vehicles. As well as just over 165,000 stock options.
Eisen also still holds a substantial parcel of shares. They number approximately 19.41 million, also owned through various vehicles. He also holds a similar number of stock options to Mr Molnar.
Afterpay currently has roughly 291.17 million shares outstanding. As such, we can put the ownership of these two founders at approximately 6.68% for Mr Molnar and 6.66% for Mr Eisen. That’s 13.34% together.
Why is this important? Well, many ASX investors, especially growth investors, love to see a founder (or founders) at the helm of the company they created. There is something of an assumption that, because the founders created the company, they will tend to be more aligned with other shareholders. This is especially so if the founders, like Mr Molnar and Mr Eisen, retrain a large portion of the company’s overall ownership.
So if you’re one of those investors, don’t worry about Afterpay’s pending acquisition. Square is also a founder-lead company, with Jack Dorsey still steering the ship.
Should you invest $1,000 in Afterpay right now?
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Motley Fool contributor Sebastian Bowen owns shares of Square. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and has recommended AFTERPAY T FPO and Square. The Motley Fool Australia owns shares of and has recommended AFTERPAY T FPO. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.