Shares in e-learning group Riverdeep rose strongly on both the Dublin and Nasdaq markets after it disclosed its major shareholders have agreed not to sell any shares for the next 12 months. The lock-up deal affects chairman and founder Mr Pat McDonagh, chief executive Mr Barry O'Callaghan and computer giant IBM.

In Dublin, Riverdeep shares rose 33 cents to €4.48 with 12.4 million shares trading, while on Nasdaq, the ADS's - equivalent to six ordinary shares - were almost $2 higher in midday trading on $24.65.

At the close on Nasdaq, Riverdeep closed at $25.50, up $2.79. Confirmation of the lock-up came as IBM disclosed it sold 12 million Riverdeep shares to institutional investors at €3.87 each, the equivalent of $21 million for each ADS. IBM still owns about 7 per cent of Riverdeep and is the biggest shareholder after Mr McDonagh who owns 38.7 per cent of the firm.

The sale by IBM improves the technical position in Riverdeep shares by increasing the size of the free float and eliminating the overhang from the major shareholders for the next 12 months.