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By Tom Winnifrith, The Sheriff of AIM | Tuesday 9 October 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.
Four days ago the CEO walked with immediate effect and without explanation. Today there is a pathetic statement from Mayan Energy (MYN) not explaining why the CEO was resigning but stating that everything is up for review: management, assets, operations. Until that is done capex is on hold. The only thing we are not told is how much cash is left. I suspect that is because the answer is SFA. On the case is the City's No 1 oil analyst Zac Phillips of SP Angel. Zac the knife pulls no punches and writes:
Mayan Energy (0.20p) – Complete Change Required: If it weren’t so serious, today’s release from the new Chairman (Paolo Amoruso), would be laughable, not least because he lacks independence – he has overseen a significant number of the transactions that the Company has undertaken. If the situation was so bad that it forced out Gonzalez, then quite how the same team that was responsible (alongside Gonzalez) will change anything, we have no idea.
Furthermore, if the problems at the Company were legal in nature, we would agree with a company headed by a Chairman operating in the legal profession, but unfortunately, the Company has suffered a series of failures because if the fact that there hasn’t been an adequately trained and experienced technical team onboard. This was the way with Connally, Gonzalez and now Wood, with the Company lawyer as Chairman.
Consequently, we believe that a complete change is required for this company to have any chance of returning value to shareholders, but to be frank, it may now be so far gone that there is no chance. If he is serious about making Mayan a well-run company, the first port of call must be the Deloro investment, and why Mayan has got such a bad deal, and why for a company that was established after Messers Wood & Gonzalez were appointed officers of the Company, did they not use a Mayan subsidiary to effect the transaction. Only after that, can you then ask why the two Mayan directors Gonzalez and Wood (via his wife’s name) also get a free carry?
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