What are shortening odds that effectively an in house deal will shortly be announced that needed CGA at 93c - even if that was not a " dinkum " trade.
DRUM ROLL. CTN bids for CGA at 90cents Cost CTN - $45m, close to 25 per cent of CTN 's gross assets.
Is this why CTN Chair resigned rapidly?
For CGA's main backers, they all walk away with a small smile and a "phew"!
The Directors who sold CAML in June 16 knew the business. -- after all some started it, and ran it very successfully for many years with good investment returns, and all Directors had been involved in restructure to bring investment group in house. However then - No mandate gains, portfolio performance still good in 15/ 16, profit under $1m on $5m revenue, and high expenses relative to revenue for a static funds management business. Sale at $13m was in excess of cost All seemed rational
Position today for CGA. Still No new insto mandates. Couple of significant ones lost. Expenses appear up 40 percent. FUM down 10 percent. No new insto mandate likely given investment performance tables and ratings by gate keepers Rev likely to be about flat at absolute best. Cash flow appears at best negative ( say ) $750,000 a quarter ( Appendix 4E 's for last year ). And there is the damage already done to CTN shareholders with the already commented on disastrous investment performance of CGA micros for these last 15 months. And it is NOTHING to do with adverse global or local markets - just comparatively bad performance by CGA.
Value today. At BEST, the sale price of 15 months ago -- ie 24 cents a share - given the history since, and despite furious activity,and the many positive words promoted by CGA re its progress.
Will the remaining Directors of CTN start to actually think of their responsibility to their own shareholders? Only! ( And their personal liability? )
And Before ASIC, ASX or shareholders have to step in to protect the 7000 small shareholders from being really put to the sword.
DYOR
CGA Price at posting:
93.0¢ Sentiment: None Disclosure: Held
