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Advanced Oncotherapy – still no answer to my questions, but does the market know something I don’t?

By Nigel Somerville, the Deputy Sheriff of AIM | Friday 13 April 2018


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.


I have asked the same questions of AIM-listed Advanced Oncotherapy (AVO) twice before but there has been nothing forthcoming from Advanced Towers. Here we go again, on the day that marks three weeks from the end of Advanced’s loan from Blackfinch, a loan which is secured on its Harley Street premises and a loan which has not yet been announced to have been paid back. Advanced may be coy about answering, but it seems the market has been voting with its feet.

As you can see from chart below (courtesy of ADVFN), the share peaked at the end of March at 60p and having been sliding ever since. But the loan, we were told by Advanced, was a 12-month deal dated 24 March 2017. The same date this year fell on a Saturday, so the first trading day after that was 26 March when the stock closed at 45p. Since then the shares have trailed off to 37p.

 

Now it could be that everything is fine and dandy: the loan could have been extended, paid off (although I know not what with) or perhaps there is the unlikely scenario of conversion (although the terms for that, at 100p, seem a tad unlikely given the shares are 37.5p). But any of those circumstances would surely have seen an RNS issued to allow Advanced’s investors to join in the celebration.

But there has been no RNS. I wonder if that is because there is a problem? Clearly the market is wondering.

Noting that the Harley Street site is held as security, and that it can be sold by Blackfinch, I would have thought that Advanced’s shareholders had much to worry about. Yet there is nothing from the company after three weeks.

We also have a Chinese investor which hasn’t come up with the £16.5 million of cash for a deal, and the initial £13.5 million paid out as a subscription (resulting in a 29.9% holding in the company) has not resulted in a TR-1, and nor has it resulted in changes to the boardroom as promised. Has the company actually received the cash (and is not held in escrow, for example)?

If there were no problems on these two fronts, why won’t Advanced say so?

Until Advanced tells us what is going on, the shares are firmly on the Bargepole list. You have (yet again) been warned.


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