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Red Flags at Night: Worthington delivers a cracking April Fool

By Nigel Somerville | Saturday 5 March 2016


Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from ShareProphets). I have no business relationship with any company whose stock is mentioned in this article.


I just can’t help myself: fully listed (sort of, as it has been suspended since 13 October 2014 so it is more a case of the undead as it still has not been booted off the main market) Worthington Group (WRN) issued an RNS after-hours last night. Was it the long overdue results for the year to September 2014, which were promised to be released in March 2015 in an RNS released in Jan 2015, but are still outstanding almost a full year late?

Ha ha! Fooled you….but that’s not the April Fool. No, last night’s no-one-is-watching o’clock RNS was a Merger Update. The company has been kicking the can down the road repeatedly over its proposed merger with Nuna Minerals since May of last year. Update after update – pretty much on a monthly basis – has put off the deadline for Nuna to make a firm offer for another 28 days.

And so we have the best April Fool I’ve seen for a long time. Sorry to spoil the joke fellas….

Pursuant to Rule 2.6 (c) of the City Code on Takeovers and Mergers (the "Code"), the Company has requested a 28 day extension to the period of time whereby Nuna Minerals A/S ("Nuna") must, under Rule 2.6 (a) of the Code, either announce a firm intention to make an offer for the Company, or announce that it does not intend to make an offer. The Takeover Panel has consented to this extension. Therefore the deadline is now 5pm on 1st April 2016. 

Surely that deadline should be mid-day?

And here’s another thing, just to show that Worthington RNSs are not worth bothering with. Take note the UKLA, as it is in your power to put a stop to this nonsense and allow Worthington’s shareholders (however deluded they may be) the chance to come to terms with their losses. One presumes that the UKLA takes a dim view of making incorrect statements via RNS. So here we are in March 2016, and Worthington tells us:

Worthington (Stock Exchange LSE: WRN) is a British investment company that  celebrates its 61st anniversary as a London Stock Exchange main market listed company this year. 

Yeah, right. Of course….so here is what Worthington was telling its followers on 30 Jan 2015 when it confirmed (ha, ha!) that its accounts for the year to Sept 2014 would be released in March 2015 (like hell they were):

Worthington (Stock Exchange LSE: WRN) is a British investment company that  celebrates its 61st anniversary as a London Stock Exchange main market listed company this year.

Is it part of the deal that the clocks stop in the presence of the undead?

As for the UKLA, shame on you. Surely it does not take this long to fashion a wooden stake and get hold of a few cloves of garlic?

No doubt Tom Winnifrith will say that there is nothing one can do to save the BBMs who still support and believe in Worthington from themselves. Is the April 1st deadline just intended to rub everyone’s noses in it?

Surely the Takeover Panel, by allowing this nonsense to continue for yet another 28 days, is engaging in cruel and unusual punishment. The USA has laws against that. Does it breach the European Convention on Human Rights? If so, anyone still holding who has come to their senses had better see a lawyer pronto…deadline June 23rd.

Or is it therefore the case that something is deemed to be beyond the remit of the Takeover Panel, and it will simply carry on extending the deadline in perpetuity until another regulator wakes up and smells the coffee?

Where is the FCA/UKLA on all of this? Ah, that’s right: keep it under wraps – don’t let any sunlight shine on it.

 

Click HERE for the full ShareProphets coverage of the Worthington saga/fiasco.


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Comments

4 comments

  1. Dear Nigel,

    I have managed to post a variation of the £1.3bn times table on the LSE and it makes perfect sense to me. Your comments are totally without merit and are potentially damaging to the conglomerate i have invested in. Please refrain from being such a loser. I can only assume you have shorted this stock and that as someone who has no investment that you are just insanely jealous of me.

    The lack of any news, the failure to provide accounts and the ‘quality’ of the directors is of course a positive in my view. Only a fool would disagree.

    I expect to be able to buy more at around £1.3bn a share when it inevitably relists providing of course that I have been released by then.

    Very best Regards

    Philobeddoe

  2. Nigel, have you, or anyone else for that matter, any idea who/what is PD COSEC LTD? Listed as an officer of WRN along with Spurway and Ware.
    https://beta.companieshouse.gov.uk/company/00527186/officers


  3. Worthingtonian

    PD Cosec just adds to the smokescreen. It appears to have been completely financially dormant since incorporation, although it’s officers have changed. I’d be surprised if its current directors knew much about the situation.

    Exposure Communications / Simon Burton / Charlotte Parham, named on earlier RNSs, are a completely different story though.

  4. Please read my extensive research before posting more of your piffle

    The model as i see it, we’re all about volume trading – creating huge interest and huge volumes. This in turn ensures we’re in the spotlight frequently which makes us attractive to investors which provides the funds to secure bigger and bigger deals – which in turn creates even more shareholder value, leading to even bigger trading volumes, which attracts even more investment to secure even more deals to fuel even more growth. Future profits will also be used eventually to fund deals further accelerating growth. All this makes us very liquid – which makes us particularly attractive to deal partners who may be looking for future investment to fund their own growth plans.

    A stock which doesn’t attract our level of interest can’t generate the levels of volume needed to attract investment, so it struggles to raise the funds to purchase the deals. This makes it unappealing to investors AND deal partners.

    The long suspension has only INCREASED interest and when we resume trading, volumes will be very high and will only continue to grow over the following days, weeks and months of resumption.

    So for deal partners, including the original ten whose NAV equated to $2 Billion plus, there will likely never, at any point in time during suspension, have been a moment when any of the deal partners will have doubted future levels of interest, volume or liquidity. Many small companies would love to be in our position – able to generate massive interest and volume. There is no logical reason why ANY of the original ten deal partners will have pulled out. Indeed, time will only have made us even more attractive as the levels of interest and anticipation continue to build as we get ever closer to resumption. It is highly likely that most, if not all of the original ten deal partners are still very much there.

    Suspension in the company’s shares will not have prevented normal daily business activities or progress. And since we’re in the business of making deals and interest has continued to grow, it’s a fair assumption that more investment may well have been secured and more deals added. Wealthy North American investors in particular, who are fond of the Berkshire Hathaway conglomerate will no doubt be keen to invest in our growth plans early on, well aware of the potential of an emerging global conglomerate.

    Since we’re all about volume trading – big newsflow, ambitious growth plans and huge potential – all of those things will put us in the spotlight – but nothing attracts buyers like a booming share price, especially one that has much further to go.

    £1300m NAV ÷ 260m shares = £5 NAV per share ; which indicates our fully diluted position = 260m shares.
    However, WRN have stated in the Q&A that further dilution will be subject to lock-in arrangements and that dilution will only ever be at a premium to the current market price at the time of issue.

    Philobeddoe 27 Feb 2016


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