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By Tom Winnifrith, The Sheriff of AIM | Thursday 10 May 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.
This is covered in bearcast but I can't disagree with a word that the great bear raider and professional Northern git Waseem Shakoor says about Frontera (FRR) ina BB post today. For a wider audience, Waseem opines:
Well, it looks as though YA and FRR have fallen out. Why might that be, as YA have done a fantastic job in selling shares to mug punters on behalf of FRR? I suspect there is more to this story than we are being told, and there are commercial terms that have not met to Zaza's liking.
Ignoring the usual nods and winks about prospects given at last night's meeting, a placing looks nailed on, effectively confirmed by management. However, any initial placing is needed to clear $2.891,000 as of 4 April 2018 as you can see HERE
" Following this conversion, YA will hold 2,891 Series A Shares with the redemption value of $2,891,000 which is redeemable on 16 June 2018."
If Zaza is being honest (no real reason to believe that, given past history) then no more shares will be issued to YA, which means they need to raise $2,891,000 to buy them out. Zaza has indicated he may buy them out himself, which he might well do, as it's a risk free death spiral loan, which is hugely profitable to the holder.
FRR needs other funds to operate with though. Where is this money going to come from? Another Primary Bid raise? There are NO institutional holders of this stock, so they are restricted to bucket shop placings, or Primary Bid, with retail holders and their credit cards.
The enterprise value of FRR at 0.475p is £106m, of which £25m is debt.
Nothing has changed with this company - it's like Groundhog Day.
Waseem stays short and why wouldn't he?
Never miss a story.
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