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Ben, the LSE has provided a price for months, presumably just taking it from SIX. If Rapid Nutrition is issuing yet more shares at 7p, over and above the 80% contracted increase in the number of its shares in issue at an average price of 10p, it tells you that the directors think right price for the shares is about 10p.
LEFKOSIA, I would be very interested to know what your accountant friend comes with regarding Rapid Nutrition (�RP�). One of the main accounting issues would seem to be the fact that over half its net assets are represented by an investment in Motivideo Systems Inc. This asset appears to have been acquired via an exchange of shares between the two companies, an announcement at the time saying the share swap was valued at $2.4m. An article suggests that RP got a 15% stake in Motivideo in return for a 5% stake in RP. Somehow RP�s investment in Motivideo has become valued at �3.5m. This may have been based on a year end share price for Motivideo when it was quoted on the GXG market, a market that no longer exists as it was closely down by the Danish Financial Services Authority due to allegations of market manipulation and fraud. Regular financial information on Motivideo was available on the GXG database until 2014 but I have not been able to find any information since then. Its last published accounts seem to be for its year to 31 December 2013 when it revealed that it had yet to generate any revenue, had lost $0.96m ($1.6m loss in 2012) and was left with cash of only $20,783 at the year end. Strangely, while RP referred to the potential for its relationship with Motivideo (I think through its Motivate Health Technologies subsidiary) in its accounts for the year to 30 June 2014, unless I have missed it I don�t think it has referred to this investment again. While RP�s accounts state its investment in Motivideo are �shares held for trading for the purpose of profit taking�, it would appear to have been impossible to sell these. This was probably a factor causing RP to have to raise money at prices dramatically lower than the prices at which it had historically been trading on the GXG and Frankfurt markets.. RP was first quoted in Frankfurt on 11 June 2014 at a price of 2.90 Euros and by 3 February 2015 its price had reached 4-30 Euros. However, by 29 June 2015 the share price had fallen to 1-20 Euros. The Board of RP determined to �� restore the value of RP�s share price� and �a significant measure was shoring up our investor relations programme�. However, in early 2016 RP decided to terminate its contract with the Frankfurt exchange due to �an unexplained suspension� of its shares. The suspension might well have been related to the announcement by Bafin, the European Financial Regulator, in November 2015 that it had evidence that organisations (boiler rooms?) were issuing buy recommendations for RP shares containing false or misleading statements and that conflicts of interest were being concealed. The strong share price performance in 2014 and early 2015 could well have reflected RP�s very positive noises about the future. A valuation report prepared for the company by Norton Smith Partners in mid-February 2015 incorporated
Addicknt, I fully endorse what you are saying. Having been involved for many years with shell companies, mainly as a principal and also as an adviser, one of the things you learn is that anyone with a decent business is extremely unlikely to pay much of a premium to NAV. Why should they when, if they have a good business, brokers will raise them the money they need on a straightforward IPO with no premium needed (they will be charged c 5% on the funds raised). Then there are those who come along with business made of straw who will say that they are prepared to overvalue the shell by a multiple of its value if the shell values their business at a similar multiple over and above its real value.