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By Tom Winnifrith | Friday 9 May 2014
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.
Part of the WPP (WPP) Group, financial PR firm Buchanan acts for more AIM listed clients than any other PR firm. But today I ask if the odours from its lavish Cheapside offices are not of expensive perfumes worn by glamorous PR birds, but from the stench of a dirty tricks campaign against those investors seeking management change at AIM Cesspit listed Range Resources (RRL)? There is no suggestion that Range itself is aware of this. So....
Let’s start with Buchanan. According to its website:
Buchanan provides independent and strategic advice and support, becoming an integral part of our client’s team.
Buchanan has as its core values honesty, integrity and respect.
These values determine the way in which we approach business and they define the principles upon which we expect our executives to operate.
Fantastic. Jolly good. PR folks who tell the truth and always act in an honest manner showing integrity and respect. You might find that hard to believe, but maybe that is why Buchannan is so successful, it is just different. Think of fluffy kittens, Angels playing harps, the late Mother Theresa and in the same vein you think of Buchanan.
I now bring you the Range Investor Group, a bunch of folks owning shares in this AIM Cesspit listed company, whose shares have slumped from almost 20p three years ago to 0.71p today. Not surprisingly many investors in this company are not happy and want changes fast. I applaud those who have thus formed RIG and are working together to force the board to make changes.
As part of this effort they have set up a website HERE where they have discussion threads covering various topics. Anyone can join. I had a few problems with the registration process but even an IT git like me managed to get through in the end.
And it appears that I am not the only non-Range shareholder to have got through. The folks who run this website are IT savvy and so were interested in one member, who had posted a number comments that were highly critical of RIG. Why, if you back the management and oppose RIG, would you join?
You can see his member profile here. He is just an ordinary investor….
er… but he is not. The folks behind RIG have tracked down his IP address and he appears to be posting from….yes, you guessed it! Think of the angels with their harps, the fluffy kittens, the late Mother Theresa and those PR folks at Buchannan who always act with honesty and integrity. As you can see the IP address of this poster is Buchanan.
Now of course this could all be a remarkable coincidence. For as Buchanan is aware, posting comments pretending to be a mug punter in support of your client who is paying you a whacking fee to spin his case is 100% against all the industry guidelines for financial PR. As financial PR firm of the year Buchanan knows this full well.
The chaps at RIG have not taken this lying down and have now contacted WPP boss Sir Martin Sorrell with a long letter listing numerous (I am sure legitimate) gripes but starting with this apparently rather less than angelic behaviour.
You can read the letter in full HERE
I have contacted Buchanan to ask whether it accepts that this is true, or has an alternative explanation for what is going on and whether any disciplinary action has been taken against any staff. A spokesman told me "we are looking into this and will respond in a proper manner next week."
I cannot wait.
Most of Fleet Street is too busy kissing PR arse to bother with this story. Kiss enough PR arse as a writer and you might get a job in PR after a while – the pay is fantastic compared to that for a journalist. Meanwhile if you kiss PR arse enough then you will be thrown titbits, scoops, news of an RNS before it is released. I guess I won't be offered a job by Buchanan or any scoops either. Plus ca change. Like I give a FF.
And why do PR men and women earn so much? That is because PR firms charge a packet for spinning on behalf of firms good and bad. They don’t care who they represent as long as the cheque arrives each month.
PR is part of crony capitalism. Bad firms pay PR people vast sums to ramp their share price so that they can issue stock at inflated prices to mug punters to pay the wage bills at the PLC itself but also the vast fees charged by PR firms, brokers, nomads and other associated hangers on. Wealth is transferred from the many (mug investors) to the few (PLC directors and all the associated advisors involved in the share promotion game). The system stinks as it is. But if an advisor steps over the line in terms of the accepted rules of the game the stench becomes unbearable.
But thank God that some advisors will not step over that line. Round at Buchanan they have core values of honesty, integrity and respect.
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