sprophets cynbear10 Jun 2016 19:54
I understand that one can have too much of a good thing so I was going to leave Boxhill Technologies (BOX) alone for a while, but yesterday’s RNS relating to the issuance of shares set me off again – bloody jokers.
The RNS related to the issuance of shares relating to the recent Emex and FreePayMaster deal and stated:
“Further to the announcement of 10 February 2016, the Company has today issued 400,000,000 new ordinary shares of 0.1 pence each ("Ordinary Shares") in the Company in conversion of £1,600,000 of 0% unsecured, undated, convertible loan stock issued in consideration for the acquisition of Emex (UK) Group Limited, and the associated company, FreePayMaster Limited (the "Conversion Shares"). The Company is unaware of any new holder of 3% or greater of the issued share capital of the Company following the issue of the Conversion Shares.”
Hold on a minute.
Emex (UK) Group Limited was incorporated in October 2015 and only had 4 shareholders and one of those, Rob Porter owned over 50% of the shares, as well as being the sole shareholder of FreePayMaster so however the consideration was structured, over half the convertible stock must have gone to him entitling him to over 200,000 shares, about 11% of Boxhill.
Now perhaps he had been giving the loan stock away willy-nilly or handed out the shares immediately to friends. Who knows, but all we do know, from that last sentence in the paragraph above in the RNS, is that he doesn’t own over 3% of the company, which would be about 56 million shares.
I did think the volume on the first day back of 240 million shares traded was a bit high and I also noticed 170 million traded a few days later but surely the Emex shareholders are more loyal, and more confident in the future of the business, than to sell down as the share price plummeted, particularly as they didn’t actually own them then!
Chairman Lord Tim Razzall has yet to answer my last set of ten questions. Perhaps he is too busy penning a resign in disgrace letter. If he has a mo, perhaps he might care to explain what is going on here. Over to you, shamed Lord R.....