With its latest New Release, entitled “Minera IRL Limited Supplements and Corrects Its Shareholder Update of November 16, 2016”, the board of IRL has moved us straight into the world of Clownfest. This bunch of idiots led by the two-faced and scheming Derrick Weyrauch (sadly, Frank O’Kelly has been usurped in practical terms) are now so desperate to get their hands on their payola they’ve resorted to attempts to hoodwink us all.
Let us be clear:
1) They claim to be desperately short of cash. That is clearly untrue, as both the 2q16 and 3q16 financials show they have plenty of cash on their books and a Free Cash Flow positive mine that generates more than enough profit to cover the company G&A. Minera IRL only needs to get to the deal stage with Cofide in order for the financing to flow, it doesn’t need years’ worth of money. Therefore, the scheme to issue up to 115m shares is unnecessary for the company well-being.
When they state that “…the Company needs to move forward, and that requires the ability to issue share capital“, what they do NOT mention is how the directors want to completely change the rules of the company by swapping its jurisdiction from Jersey to Canada. If they succeed, they will be able to issue shares without any further approval and this blog repeats, they’ll be able to award the shares to anyone they want and at whatever price they want, unlike previous years.
2) But then we move into Mondo Bizarro. IRL’s desperate directors have now tried to backtrack on the statement that they’re looking to re-list in the AIM market in London, as per their November 16th NR. Today they say this:
“Discussions are in progress with our transfer agent to find an
efficient mechanism to allow UK based shareholders to trade their shares
upon the resumption of trading in Canada. The Company may in the future
and subject to appropriate market conditions, seek an AIM listing but
currently no plans are in place to do so.”
That, ladies and gentlemen readership of IKN, is so obviously BS it’s laughable. So please pay attention and read this section of the document that really matters, the 2016 Management Information Circular (MIC) filed on SEDAR earlier this month (I’ve helped with a bit of bold-typing):
The Board proposes to replace the Company’s current Articles of Association (the “Existing Articles”) with new Articles of Association (the “New Articles”) in substantially the form attached to this Information Circular as Schedule 1. The primary reason for replacing the Existing Articles with the New Articles is to provide the Company with a modern set of Articles of Association tailored to the Company’s primary trading market in Canada. The Existing Articles were tailored to conform to the requirements of two trading markets – the AIM market of the London Stock Exchange and the Canadian Toronto Stock Exchange (or TSX) – but the Company is no longer listed on the AIM market and has no intention of seeking to renew that listing. Some of the provisions included in the Existing Articles were adopted in order to conform to standards that are customary in the AIM market but not in the Canadian capital markets; these provisions are, on the whole, more restrictive than customary Canadian corporate and capital market provisions. As the Company is at the date of this Information Circular actively pursuing a listing on a Canadian stock exchange, management believes it to be in the Company’s best interest to adopt Articles of Association that will enable it to carry on its business and access the Canadian capital markets without the more restrictive AIM derived provisions imposed in the Existing Articles.The main differences between the Existing Articles and the New Articles are that the New Articles (i) do not require shareholder approval in advance of any allotment of securities, and (ii) do not impose pre-emptive rights on securities to be issued.
Get that?
1) The primary reason…THE PRIMARY FREAKIN’ REASON...these clowns want to completely change the rules of governance at the company is that they have no intention…NO FREAKIN’ INTENTION…of listing on the AIM. All this “yeah well we’ll see later” malarkey they’re now trying in order to throw sequins in your eyes is total hogwash. The real document, not the NR, states it clearly. They’re changing all the rules of the corporate governance because they won’t ever need to comply with AIM rules any longer. And I remind you of the words of the large shareholder of IRL located in Peru in yesterday’s post who said:
“In our same meeting last year you and/or Mr. Bavin stated that it was
important to list in the AIM so that certain investment funds are not
forced to sell under pressure.”
In other words, the move away from AIM is extremely shareholder and price unfriendly.
And then in that second paragraph we get to see just why they want to change all the corporate governance rules. They get to allot shares without asking us ever again, which is completely unlike previous years. Which makes you wonder just how sincere all the first part of today’s NR is, all that about “well we only said 50% because it sounded like a nice number”.
This is madness! They’re trying to tell us that maybe in the future they’ll consider going back to the AIM, when the real plan is to change the rules to allow the dilution taps to be turned full on and the only way they can do that is by leaving the AIM! Do NOT believe the news releases, believe the company’s own words in its Regulatory Filings. It is now patently obvious that this board of directors cannot be trusted and that they are saying and doing anything they can to trick us, all this from a board with the worst possible track record of fiduciary duty towards it shareholders. They are not deserving of our trust or support. This upcoming AGM is the last chance to stop the legalized rape of this company and the only way to do this is to get rid of Weyrauch and his band of opportunists. If left unchecked, they are going to pocket the money that we shareholders deserve.