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Lenigas Cuba – Knowlton Capital takeover - utter bollocks from Jabba the Share ramper

By Tom Winnifrith, The Sheriff of AIM | Saturday 30 April 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.


David Lenigas on Friday made the following exciting announcement regarding the disastrous ISDX IPO that is Lenigas Cuba (CUBA). He boasts of an RTO but it is all utter bollocks. Jabba announced:

Potential Takeover of Leni Gas Cuba by Canadian Public Company

London, Havana: 29 April 2016: London listed Cuban specialist investment company,

Leni Gas Cuba Limited announces that it has entered into a letter of intent with Canadian listed Knowlton Capital Inc. ("Knowlton") (TSX-V : KWC H) for a potential take-over of LGC by Knowlton (the "Takeover"). Knowlton is a TSX-V listed investment company with an experienced management team. LGC would look to maintain its listing on the London ISDX market, as a possible dual listing, if deemed appropriate.
David Lenigas, Leni Gas Cuba's Executive Chairman, said,

"The proposed Takeover by Knowlton of the Company, could deliver significant short and long term benefits to LGC shareholders, by providing greater access to the very significant North American capital markets, where there has always be considerable investment interest in Cuba through tourism, business and Government to Government relations."

"This proposed transaction, should provide access to the greater depth and liquidity of the TSX-V, a leading global exchange."

"Given the historically strong strong trade and tourism ties between Canada and Cuba, the TMX and its TSX-V exchange is therefore the logical market for LGC. In Knowlton, we would also be adding a number of highly experienced directors well versed in the major North American capital markets."

Ends. That is bollocks.

Ok now for the real story. Who is Knowlton and how will it pay for the deal?
Knowlton describes itself as a “shell” company which is listed on the NEX Board of the TSX Venture Exchange. The NEX board of the TSX Ventures Exchange provides a trading platform for listed companies that have low levels of business activities or have ceased to carry on an active business.

The latest accounts for the period ended 31 December 2015 indicates it had cash of C$ 416,790. In its last year end accounts for the period ended 30 June 2015 its audited added an emphasis of matter paragraph drawing attention around its ability to continue as a going concern.

The deal is described as reverse takeover in Canadian press.

Interestingly Knowlton has previously announced a potential reverse takeover with Mogul Ventures Corp which was referred to be Reabold Resources Plc in its unaudited results for the six months ended 30 June 2015 with named directors Anthony Samaha and Jeremey Edelman whose also happen to be directors of Lenigas Cuba what a small world.

The reality is that Knowkton has post the costs of this deal no cash at all. So all thta happens is that Lenigas Cuba shareholders get diluted a bit more to buy a company with no assets and no cash. Great? How is that value creation? Of course it is not it is just ramping. Knowlton's shares are rarely traded and Lenigas Cuba shares are very rarely traded on the ISDX lobster pot.

So there will be no benefits just dilution. As ever all sorts of ramping but no substance. It is now 8/05 AM at 9.20 AM I shall be on stage exposing Jabba in full at UK Investor. This is not the only shot company he has floated and RNS full of hot air he has issued. Far from it...


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More on CUBA


Comments

1 comments


  1. Duck and Dive

    Aye, Devious Dave describes it as a takeover of LGC by Knowlton — as if to imply that someone actually finds LGC desirable — while the somewhat more believable Canadians have called it a reverse takeover of Knowlton by LGC, which says nothing about the desirability of LGC’s lucky-dip bag of barely-breathing businesses.

    Presumably, this is simply a safer/cheaper way to get LGC listed on another exchange than applying directly. But the toxic depths of the TSX-V market aren’t many folk’s idea of a promotion.


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