Yes @Valueinvestor0909 and @Hackofalltrades - the KME director buys would have been coordinated to help absorb the supply - being 2 million shares - all hitting the market at once. If you don't have an increase in buying on market when that many shares hit the boards for sale with a smaller cap (and low liquidity) stock like this, it can really spook the market and cause a selling frenzy, which could drive the share price down a lot. Having had prior warning of this 2m share sale, the KME Board would likely have acted in this way to avoid that market panic, and they seem to have done a reasonable job too considering the shares rose +14.3% on the day instead of falling. Their positive Trading-Update.PDF released pre-open on the day (Wednesday 28th June) would certainly have set a good platform for that rise, even with that extra volume traded. I wonder if the timing of the Trading Update could also have been in response to knowing that those 2m shares were hitting the market on that day.

Check out the volume on Wednesday (28th) - which is when the 2 million KME shares were sold by "GoSchoolBox" on-market, and the KME directors bought 350,000 of those shares, clearly to show the market that there were buyers willing to absorb at least some of those 2m shares.

So, all-up, on the 28th, over 3.65m shares were traded, when the average daily volume is more like 1,000 to 75,000 shares.

If there were not decent buyers stepping in, as the KME Directors were, the market could have easily been spooked by a sale that large.

It is also worth noting that sometimes a company will facilitate such director or KMP (key management personnel) buying of their own shares (in a situation such as this in particular) via a loan or by bringing forward payments to those guys that would help cover the share purchase costs. Not saying that has happened here, coz I do not know, just saying it can happen sometimes. Not that I reckon Storm McGrath would need a loan, but the others might have been helped along to present a united front so to speak.

Anyway, between the positive Trading Update and the director buying, the market didn't fret at all about those extra 2m shares being sold on the day, so all in all, I reckon the board did a decent job there.

Final thought is that every company should have a director and KMP/company-employee share trading policy, which usually prohibits shares being bought or sold during any period in which those individuals have access to information that is relevant but not yet released to the market, and many such trading policies actually prohibit all share trading except during specific periods - often referred to as windows. Those windows are usually directly after results have been announced, or after the company has otherwise updated the market on how the business is travelling.

I haven't dug into KME's share trading policy myself, but in simple terms, if the directors had wanted to buy shares because they thought they were undervalued, yet they also knew they were about to release a Trading Update, they should wait until after the release of the Trading Update before buying or selling shares. Which is what happened here. As it should have.

If they had bought shares and then released a Trading Update which resulted in a decent (like, +14.29%) share price rise, then they could have been accused of insider trading, and of breaching the company's trading policy.

So the timing makes sense on a number of levels really.

Disclosure: I do not hold KME shares.

" I wonder if the timing of the Trading Update could also have been in response to knowing that those 2m shares were hitting the market on that day."

I also wonder at that timing and that seems likely to me.

I also wonder who bought the other shares. That's a huge volume on market in 1 day and doesn't necessarily feel like the market could manage that by itself.

@Hackofalltrades I was told one institution took all of the shares Storm and co didn't take. Not sure who it was though.

Just to quickly add to this forum, specifically on various company trading policies. I came across this updated Trading Policy released today by Swoop (SWP) - Securities-Trading-Policy.PDF - click on the name there (in blue) to access the PDF file. It goes through the insider trading rules and how they are enforced through the trading policy and they also have additional "Blackout Periods" which are periods during which the company's Directors and KMP (key management personnel, such as senior management who would have access to information not readily available to ordinary employees of the company) and sometimes other employees as well - are prohibited from buying or selling securities (shares, options, etc.) in the company.

Those "blackout periods" are usually duirng weeks when reports are being prepared - such as the full year or half year results - or during strategic reviews - or the weeks leading up to the AGM. In Swoop's case, they define their Blackout periods like this:

6.3 Blackout periods

Restricted Persons must not deal in the Company's Securities during any of the following blackout periods:

• 6.3.1: the period each year from the close of trading two calendar weeks before the end of the full financial year until the second trading day following the announcement to the ASX of the preliminary final financial statement or full year financial results;
• 6.3.2: the period each year from the close of trading two calendar weeks before the end of the financial half year until the second trading day following the announcement of half-yearly financial results;
• 6.3.3: the period each year commencing two weeks prior to the Annual General Meeting and ending on the second trading day following the Annual General Meeting; and
• 6.3.4: any other period that the Company specifies from time to time. 

They also prohibit senior management from short term trading of the company's shares: "Restricted Persons should not trade in the Company's Securities on a short term basis or for speculative trading gain."

Swoop's Share Trading Policy is very clear on Page 6 in describing who those "Restricted Persons" are, and who they need to request consent from before trading in the company's securities, and who they need to inform once they have made any trades. In Swoop's case, the Chair of their Audit and Risk Committee needs to be notified, and they would ensure that the Company Secretary lodges all the required paperwork to comply fully with both ASIC's and the ASX's regulations and rules.

Kip McGrath's (KME's) Securities Trading Policy can be viewed here: https://www.kipmcgrath.com/global/pdfs/KME Share Trading Policy.pdf

That link can be found on this webpage of theirs: https://www.kipmcgrath.com/global/shareholder-information

This additional info is just to round out my earlier commentary around the recent director buying directly after they released the Company Update and on the same day that a US-based company (that KME had purchased a business from and paid for some of that business via the issue of new KME shares) sold 2 million KME shares on-market.

Just reinforcing my earlier comment that the timing would have been in part to comply with their trading policy, so all good.