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Echo Energy - gets into bed with twice convicted market abuser as its new broker

By Tom Winnifrith, The Sheriff of AIM | Monday 7 August 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.


Having rather publicly fired its old retained broker Brandon Hill Research on 31 July for being sensible, Echo Energy (ECHO) has today announced it has a new broker Hannam & partners. Who? I must admit that I have never heard of this firm and an RNS search shows it acting for just one other London listed company as its retained broker. But maybe it has a big research capacity to ramp the shares? er...

The screenshot from its website below, does not indicate that there is much in the way of research. Echo insists that "Hannam & Partners bring (sic) a proven capability to originate and execute asset and corporate level transactions in line with the Company's strategy for corporate growth across the region, as well as supporting the Company on its interface with investors and providing targeted research for the company.". Hmmm. targeted research. Whatever.

So is the brains behind this firm? Step forward Ian Hannam. Why does that name ring a bell? Er.... og yes he was that fellow fined £450,000 by the FCA for two counts of market abuse as you can see HERE. In a proper regulatory regime he would not still be working in financial services at all. But the FCA is like the governing body of world athletics. Sure you are a drugs cheat, take a small penalty then come back and you too can be world champion, do not go to prison, feel free to pass go and collect as much money as you can.

With the convicted market abuser now on board to orchestrate the ramp the shares up by c8% to 12.5p giving a fully diluted market cap of in excess of £40 million. Net cash is c£15 million and falling and the company has one small exploration asset in South America. The valuation is a total joke and no amount of ramping by the market abuser's firm will change that. One broker today described this company as "the plate spinning play by James Parsons". Cenkos, last week, was even ruder - and bang on the money - as you can see HERE.

Sell.


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