By Tom Winnifrith | Friday 10 March 2017
Disclosure: I own shares in one or more of the stocks mentioned. 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.
Advanced Oncotherapy (AVO) has today called its GM to approve the issuance of more shares to feed the Bracknor Death Spiral - more on that later for the document is, like the company, a joke. But first lets go to a big fat monstrous lie it told last year to help get that bailout placing away in September.
Today as shareholders are asked to vote for the confetti blizzard needed to allow death spiral finding to accelerate the share price destruction were are told:
The Company also confirms that a number of financing options remain under consideration. These include, but are not limited to, non-dilutive financing, the facility with Metric Capital, in relation to which constructive discussions continue, and asset-based lending. The Company is in receipt of several term sheets for asset-based funding and, at this date, has not drawn down any funds under the Metric Capital facility.
Ok so no £11 million drawn down. I had rather assumed that it had been because on 26 May 2016 Advanced stated in an RNS announcing the Metric deal:
Of the £24 million financing, £11 million will be received shortly following signing. The second tranche of £13 million will be available for drawdown on completion of a £25 million cash or capital injection to fund the development of a manufacturing base. Should these milestones not be achieved by the end of March 2017, the initial £11 million tranche will become repayable by September 2017.
So investors were lead to believe that £11 million was on the way PDQ. That supported the share price through to September 30 - notwithstanding the dumping of his entire stake by Tony Blair's pal, NED Lord David Evans in blatant breach of closed period and, possibly, insider dealing, rules. And thus on 30th September the company was able to do a placing at 100p.
On that day Advanced stated
In May 2016, we announced that we had signed an agreement with a fund advised by Metric Capital Partners LLP ("Metric Capital"), a Pan-European private capital fund manager, to invest £24 million in a financing facility to support the Company's provision of vendor financing for the installation of our first LIGHT machine in Harley Street. This facility was conditional upon a future £25 million cash or capital injection to fund the development of a manufacturing base for the LIGHT system.
But that is a lie. Since it is NOT what the company said in May when it said that only tranche 2 came with strings.
On September 30 Advanced also stated that Metric would allow draw down on "the implementation of a financing plan supported by banks and strategic partners which is not dilutive to equity investors."
The insistence that Metric is still gagging to go ahead even though 100% of the order book has disappeared and now that funding is mega dilutive just does not stack up. But there is now a bigger question relating to that 26 May RNS which appears to have been materially misleading or certainly should have warranted a correction in summer 2016 when £11 million did not arrive. And also to the lie told on 30 September.
Advanced either lied initially about the arrival of the £11 million or something happened which it did not announce as it should have when the wonga failed to arrive. Either way on the runway to a mega placing that is s shocking breach of AIM Rules and another reason why this stock is uninvestable.
Companies that tell lies repeatedly always, eventually, run out of other folks cash. Keep selling. Target price 0p.
Never miss a story.
This area of the ShareProphets.com site is for independent financial commentary. These blogs are provided by independent authors via a common carrier platform and do not represent the opinions of ShareProphets.com. ShareProphets.com does not monitor, approve, endorse or exert editorial control over these articles and does not therefore accept responsibility for or make any warranties in connection with or recommend that you or any third party rely on such information. The information available at ShareProphets.com is for your general information and use and is not intended to address your particular requirements. In particular, the information does not constitute any form of advice or recommendation by ShareProphets.com and is not intended to be relied upon by users in making (or refraining from making) any investment decisions.
Comments are turned off for this article.
Search ShareProphets |
Stock market news |
Recent Comments |