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Daniel Stewart – who bailed into Rob Terry’s Quob Park Estate Ltd just ahead of delisting? My, that was lucky….or was it?

By Nigel Somerville, the Deputy Sheriff of AIM | Saturday 16 July 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.

Shares in former AIM Cesspit poster-boy Daniel Stewart Securities plc (DAN) were booted off the exchange back on 22 Jan 2016. That must have been a tad galling for Quindell (QPP) fraudster Rob Terry and his henchmen at Quob Park Estate Ltd, which had previously suggesting that there was upside to 10p a share on offer. Having been suspended in October 2015 for failing to publish accounts (still outstanding, by the way), the loss of Beaumont Cornish as Nomad in December put the final nail in the coffin.

On 15 Jan 2016 the company released an update on its suspension, telling the market that:

The Company's largest shareholders remain very committed to their long term support….

But a trip to Companies House tells an odd story, for according to two filings in relation to Rob Terry’s Quob Park Estate Ltd it appears that there were two transactions on 19 January 2015 (just three days ahead of the delisting of Daniel Stewart) in which some mystery person(s) exchanged shares in DAN for shares in Quob. My, oh my, that was good timing!

The two transactions, valuing DAN shares at the suspension price of 1.625p were for £281,240 and £155,090 – a total of £436,330. Given that the shares were delisted just three days later one might imagine that the value of those shares took a bath when there was no market left on which to trade them.

But what lucky people they (who were dumping their DAN stock in favour of Rob Terry’s Quob stock) must have been to get out so very close to the one-way trip to the execution chamber! Yup, an incredible stroke of luck. Genius, in fact.

But there is a small anomaly in all of this, and that comes from the sequence of share allotment filings by Quob showing on the Companies House website. The anomaly is apparent when one looks at the statements of capital across those filings. If you put those filings in order of share capital, it is immediately apparent.

Those filings for the 19 Jan 2016 exchanges of DAN stock for Quob stock show a statements of capital as £7,978,338 and £8,014,872 respectively.

So how come there are 29 statements of capital following allotments of shares which show a lower figure, yet – apparently – those share allotments took place afterwards?

Here is the full list of share allotment filings (date of allotment and stated resulting share capital) going back to November 2015, given in order of rising share capital (the 19 Jan 2016 filings are in bold):

Allotment Date       share capital(£)

6 Nov 2015                  7,815,268

6 Nov 2015                  7,827,268

28 Jan 2016                 7,829,357

29 Jan 2016                 7,839,107

29 Jan 2016                 7,842,230

29 Jan 2016                 7,842,530

29 Jan 2016                 7,842,788

30 Jan 2016   (sat)      7,846,661

30 Jan 2016   (sat)      7,849,516

30 Jan 2016   (sat)      7,850,116

31 Jan 2016   (sun)     7,853,017

31 Jan 2016   (sun)     7,854,412

31 Jan 2016   (sun)     7,854,802

31 Jan 2016   (sun)     7,855,156

31 Jan 2016   (sun)     7,855,285

1 Feb 2016                  7,858,535

1 Feb 2016                  7,861,535

3 Feb 2016                  7,862,913

3 Feb 2016                  7,863,045

5 Feb 2016                  7,864,161

8 Feb 2016                  7,866,963

8 Feb 2016                  7,867,935

10 Feb 2016                7,869,388

17 Feb 2016                7,874,624*

17 Feb 2016                7,875,902*

17 Feb 2016                7,876,319*

18 Feb 2016                7,896,691*

18 Feb 2016                7,901,399*

16 Feb 2016                7,910,898*

16 Feb 2016                7,913,024*

1 Apr 2016                  7,962,829

19 Jan 2016              7,978,338

31 May 2016              7,986,748

19 Jan 2016              8,014 872

31 May 2016              8,016,857

31 May 2016              8,021,889

31 May 2016              8,031,257

31 May 2016              8,037,490

(*shares issued as consideration for take-over of YooDoo Media Ltd: date order a bit muddled, but at least it was consecutive.)

I put it to you that the above suggests that those transactions claimed to date from 19 Jan 2016 actually took place on 31 May 2016. Indeed, the share allotment filings from 31 May 2016 were all posted on 20 June 2016 – along with the 19 Jan 2016 filings. Yet all the filings for share allotments at the end of Jan 2016 and during Feb 2016 were posted by Companies House on its website on 20 April 2016.

As it happens, a charge against the assets of Daniel Stewart & Co plc (a subsidiary of DAN), which bore more than a passing resemblance to a charge against the parent (itself only created on 29 Jan 2016 and posted on the Companies House website on 17 Feb 2017) was created on 26 April 2016 and posted on the Companies House Website on 6 May 2016. 

No doubt all of the above is just a complete coincidence, and there is a perfectly rational explanation for why Quob Park managed to issue shares in itself in exchange for DAN stock just three days before the latter was delisted, and yet a whole series of twenty-nine subsequent share allotments resulted in a lesser resulting share capital.

Answers on a postcard…..

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