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Advanced Oncotherapy, Lord David Evans and that pre-placing share dumping - why no P45?

By Tom Winnifrith | Wednesday 26 October 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.

On 30 September 2016 Advanced Oncotherapy (AVO) announced not only its interim results but also a large placing at 100p. In the run-up to a placing and in the eight week closed period ahead of numbers surely no director could dump his entire holding? Surely not? Think again.

Yesterday it was announced:

Advanced Oncotherapy, the developer of next-generation proton therapy systems for cancer treatment, announces that between 19 August 2016 and 16 September 2016 Lord David Evans, a Non-Executive Director of the Company, disposed of 136,296 ordinary shares of 25 pence each in the Company ("Ordinary Shares"), at a weighted average price of 121 pence per share. Following these transactions, Lord Evans no longer holds any Ordinary Shares of the Company

So Lord Evans, who earns £49,350 a year and chairs Advanced's audit committee so must have been aware of the financials and placing plans, sold all his shares both ahead of a placing and also in a closed period.

AIM Rule 17 states:

An AIM company must issue notification without delay of:

♦ any deals by directors disclosing, insofar as it has such information, the information
specified by Schedule Five;

I suppose Lord Evans might regard just over 2 months as "without delay." AIM Rule 21 is more important:

An AIM company must ensure that its directors and applicable employees do not deal in any of its AIM securities during a close period. In addition, the purchase or early redemption by an AIM company of its AIM securities or sale of any AIM securities held as treasury shares must not be made during a close period.

The Exchange may permit a director or applicable employee of an AIM company to sell its AIM securities during a close period to alleviate severe personal hardship.

Hmmm. On Advanced's website were are told:

Lord David Evans has had a extensive career in printing & publishing and holds numerous chairmanships spanning across healthcare, media, business consultancy and charity

Hmmm. So is he a) really hard up or b) is this a coach and horses breach of AIM Rules in which case surely he needs to be issued with a P45 without delay.

That Evans still has a job is yet another red flag, one of many reasons not to own these shares.

PS I asked the company's PR bimbo if Advanced wished to comment. That offer was declined.

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