As David Lenigas ramps away, Gibraltar Regulator says yes to Valereum buying the Gib Stock Exchange1 Nov 2022 09:22
By Tom Winnifrith | Monday 31 October 2022 (Share Prophets website)
Richard Poulden’s Valereum Blockchain (VLRM) first applied for permission to buy the Gibraltar Stock Exchange on 25 October 2021. Today it says that Gib’s equivalent of the FCA, the FSC has cleared the deal. But has it?
I can see why Poulden and his toadying mate David Lenigas, a shareholder in Valereum, a twitter cheerleader ( as you can see below) and a man who has twice vested assets into Poulden’s other company Wishbone (WSB) without disclosing if he enjoyed any mark-up, would want to big up what has happened.
But today’s statement says that the FSC has finally given the green light for the transaction but that:
"This is subject only to conventional conditions pertaining to regulatory and working capital as required."
So it’s a green light as long as certain regulatory conditions are fulfilled. So that is really an orange light then. And the FSC needs to see that Valereum’s tank has enough petrol in it to get past the lights and keep the car running. Oh…. Er…
As at 30th June, Valereum had current assets of £988,736 of which about two thirds were cash. It had current liabilities of £2,462,751. Its operating cashburn in the first half of this year was £990,385. So ceteris paribus, right now it has NEGATIVE working capital of c£2 million.
Hmmm do you think that in allowing an entity to control its national (albeit joke) exchange subject to working capital conditions a MINUS £2 million ( and growing) position checks all the boxes. Maybe in the dodgy world of offshore tax havens it does but I suspect, even there, that it does not. And of course that is exactly why Poulden and Lenigas are ramping the shares… Valerem needs cash to sort out its working capital and there is only so much its death spiral provider can pony up given the lack of liquidity in the stock.
Therefore, anyone buying into this bull needs their head examined.
I asked the FSC what the exact remaining conditions are but in the spirit of transparency for which dodgy offshore tax havens are renowned it took five hours to say that it would not comment.
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