on the move

Mystery surrounds firms `on the move'
By CAMERON ENGLAND
10aug05
SHAREHOLDERS in listed companies Lion Energy and Entek Energy are still in the dark about the future of their investments.

Both companies appear to have vacated their Melbourne St offices.

The phone has been disconnected as has the mobile phone of managing director Guiseppe Mercorella.

A recorded message at a Perth number lodged with the Australian Stock Exchange yesterday said notices had been lodged with the ASX.

"As soon as they (the notices) have been processed, everything should be back up and operating again," it said.









Lion and Entek shares were placed in a trading halt on Tuesday of last week and suspended from quotation the following day.

Then on Friday, director Carmine Barone lodged a final director's interest notice for Lion Energy, but he had not previously advised the market he would be stepping down.

The Advertiser has not been able to contact Mr Mercorella, Mr Barone or fellow director Julian Waterman.

On Monday, Mr Mercorella consented to Federal Court orders appointing a liquidator to an alleged managed investment scheme, which the Australia Securities and Investments Commission says owes mostly SA investors about $56 million in amounts ranging from $50,000 to $8 million. ASIC has alleged Mr Mercorella, of Rosslyn Park, has been operating the scheme in breach of the Corporations Act since at least 2002.

"Many of the investors are from SA and became aware of the scheme through family and friends," ASIC said.

"Some investors have mortgaged their homes to invest with Mr Mercorella."

Mr Mercorella decided last month to step down as MD of both listed companies.

The companies said while his court issues were of a personal nature, he had decided to resign in light of the "substantial extra commitments" the issue would entail.

He insisted at the time all investors' money was safe.

The day after his legal troubles surfaced, 91.79 Lion million shares worth $365,000 changed hands, driving the shares down 20 per cent.

Mr Mercorella also agreed on Monday not to leave Australia without the consent of ASIC until the liquidator of the scheme had ceased to act, and agreed to having a receiver appointed for his assets.

Anyone who has lent money to Mr Mercorella or the connected Seabay Investments, can contact receivers McGrathNicol+Partners on 8468 3700 or 1800 287 860.