By Tom Winnifrith, The Sheriff of AIM | Saturday 7 October 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.
The Conroy Gold & Natural Resources (CGNR) GM voted c 5 million to 4.1 million to back the current lifestyle funded, rule breaking board led by 84 year old Professor Moriaty and not the rebels From attending the meeting there are two takeaways which tell me the shares will collapse next week and proof of just how grossly misleading an RNS from Wednesday was.
The vote should have been a bit closer. One owner of 236,000 votes who backed the rebs forgot to sign his proxy. So the real margin was c650,000. The issue of 1.2 million new shares to Prof Moriaty and patsies over the past week achieved the objective.
Revelation 1 is that rebel backing shareholder Andrea Gonella appears to have sold c200,000 of his shares. Maybe he saw the writing on the wall. I have not spoken to him but the fear must be that he will dump more shares in disgust. This stock is not liquid and Gonella's remaining 515,000 shares would normally take 5 trading days to digest. That is quite some overhang and a TR1 from Andrea confirming the sale may panic others.
Revelation 2 is that the £148,000 Conroy Gold got from Prof Conroy and henchwoman Maureen Jones exercising out of the money warrants on Wednesday (to ensure the "right result") has already all gone. Under questioning the Prof fessed that It was all used at once to repay loans from er....Prof Conroy & Maureen Jones. That is how Conroy works. It pays PC and MJ a fecking fortune. If it has cash they are paid in cash. When it runs out PC & MJ loan Conroy cash to pay their obscene salaries then when there is a fund raise they get paid back. What's not to like?
On 4 October when the warrants were exercised Conroy stated
"Proceeds of the subscription and warrants exercise to be applied to fund the advancement of the Company’s gold assets, in particular the development of the Clontibret deposit and increased exploration at the Clay Lake Deposit. Additional exploration will be focused on the Slieve Glah gold prospect and other targets within the 50 km Armagh- Monaghan – Cavan gold belt and for working capital generally"
I put it to you that the above statement was, in light of the Prof's GM confession, at best, grotesquely misleading - £148,000 of the proceeds went straight back to the board, at best c£25,000 went to the company which is desperate for cash to pay bills. How much of that £25,000 will actually be spent on exploration? Jac sit, that is how much.
At worst tat RNS is a downright lie issued by scoundrels and signed off by advisers like Virginia Bull of Allenby and the loathsome Jon Bellis of Beaufort who really do not give a flying fuck about investors being screwed on their watch. Bull and Bellis: how do folks as morally bankrupt as you sleep at night?
But what that also means is that having raised well sub £200,000 net in recent placings Conroy is still out of cash. The funds from the placing will NOT go on exploration but on paying off other creditors. And that means that another placing is needed and needed fast. The last placing was to mates of Prof Conroy who came in so they could vote at the GM. Their work done is so I'd expect some of them to start selling on Monday.
The next time the grubby Bellis tries to raise cash ( and it will have to be very soon) he will have no choice to go to the bucket shops of London and given the illiquidity of these shares the discount is going to be huge. If the shares are 25p ( and given the Gonella overhang and possible dumping by Conroy placing patsies they won't be for long, any placing by the nasty little peasant Bellis will be at 15p or less. As the shares fall so would the placing price.
If I was a bucket shop I would tell Bellis to fuck right off until a) any Gonella overhang was cleared, b) it was clear that any Prof C placing patsies who were selling were out and c) it is clear how the biggest rebel, 26% shareholder Patrick O'Sullivan is going to react. This is a sideline for the very wealthy O'Sullivan and I was with him after the GM and to say that he was incandescent at the dirty tricks played by Prof Moriaty would be an understatement. Will O'Sullivan buy, hold or sell. He could afford to write off this investment and just move on. He has a weekend to reflect but if there is any sign that he is offloading this stock could crater. Until a, b & c are cleared up the loathsome Bellis will simply not get a placing away.
Buy Conroy Gold needs cash fast. And that makes the stock a slam dunk sell at 25p. My 12.5p target is, if anything, generous. For Prof Moriaty and henchwoman Jones I suggest that Friday's win will be a pyhrric one
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