By Cynical Bear | Monday 17 July 2017
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.
My heart sunk last week as I noted that the Plutus Powergen (PPG) boys were at it again with their third Sub-Standard List effort coming to the market in just over a year, despite the first two efforts being absolute flops. Oh well, welcome Fandango Holdings (FHP), you’re in the squad– let’s take a look.
This won’t take too long as it is a carbon copy of both last summer’s effort, Papillion Holding (PPHP), and Stranger Holdings (STHP), which joined the Standard List in January 2017. The gang of Charles Tatnall, James Longley and Tim Cottier clearly see this as a route to make money and, to be fair, they may well be right from a personal point of view.
Each time, the new vehicle raises between £800,000 and £1 million (gross) at 1p and the founders contribute around £125,000 or so at around 0.22p. That is at the top end for Founder discounts which would put me off in any event, but what I can’t get my head round is whether anyone does any diligence before investing as one only needs to give the previous efforts a cursory glance before deciding to stay well clear.
Papillon came to market in June 2016, was suspended in September pending the potential RTO of a previously failed gambling business, Myclubbetting.com, and remains in suspension today. It couldn’t even get its accounts out for the year ended 31 December 206 which were due on 30 April 2017. Quality stuff!
Its sister company, Stranger Holdings, has done absolutely nothing since joining the Standard List in January this year. Its year-end results are due out at the end of July, not that I’m expecting anything exciting to come out of those.
It’s slightly odd that Fandango will now be competing directly with Stranger Holdings in looking for its first investment (and probably Papillon too as and when its RTO collapses) not that I expect the founder team to care too much about that.
Funnily enough there are a lot of similarities in the three Prospectuses for these companies and with the adviser base too; however, I found it amusing to spot that each company has used a different placing agent / broker, presumably as it would be difficult for Cornhill and SP Angel, who advised Papillon and Stranger respectively, to pick up the phone to its clients and convince them to get involved in this piece of crap if they were in the other vehicles. Turner Pope has done the dirty on its clients this time.
It is dispiriting to note from Companies House that, between the founders, there are at least two more shells with “Holdings” in the title, being Strategic Holdings Limited and Dabile Holdings Limited, so it wouldn’t surprise me that in about a year’s time, they’ll have their own Sub-Standard Shockers five-a side team.
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