Gasol plc’s share price has fallen by 55.84% over the last year
Published:
June 26, 2014 at 8:25am
This despite the hot-project plans for a new power station which will control a substantial part of Malta’s electricity supply. Gasol plc is now seeking de-listing from the alternative list of the London Stock Exchange. Delisting will free it up from corporate governance controls and reporting requirements.
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“Delisting will free it up from corporate governance controls and reporting requirements.”
The plot thickens.. and thickens and gets murkier and murkier..
Yet Comrade Mizzi and his puppet-master keep ‘calmly’ re-assuring us that all is well in the power-station project. “Steady as she goes” would be their word.
Perhaps the most fundamental questions to be asked immediately now are:
Who controls Gasol plc and who will be controlling it in the foreseeable future? Are there any plans for a change in the control of Gasol (immediately after the delisting from the London Stock Exchane AIM)?
Currently, African Gas Development Corporation Limited (AGDCL) is Gasol’s majority shareholder and effectively controls Gasol. AGDCL has a stake of approximately 70% in the share capital of Gasol.
But very little information is available publicly about AGDCL. It has no website.
The site here reports that the company is based in South Africa, a very remote location from Malta, and that its founders were Dr. Rilwanu Luman and Mr. Ethelbert J Llewellyn Cooper – both of them hold roles with the board of directors of Gasol as chairman and strategic advisor respectively.
http://investing.businessweek.com/research/stocks/private/snapshot.asp?privcapId=31338319
There is no public knowledge about AGDCL’s current shareholders and control.
This site here reports a compay with a similar name based in the Seychelles. Is it the same company?
https://www.dynamar.com/subjects/156311-African-Gas-Development-Corporation-Limited
As long as Gasol was listed on the London Stock Exchange, the government could be excused to claim that due diligence on Gasol shows that Gasol is listed on the LSE AIM and therefore it is subject to control and vetting by the LSE, a major international institution, and by the markets and the media which monitor LSE companies.
But now that Gasol is delisting to be turned into a private company, the government cannot put the responsibility for due diligence on the transparency of stock markets and the public and media attention.
In my opinion, it is now fundamental for the Maltese media to get the government to explain, and to understand and monitor, the control of Gasol. It holds 30% of Malta’s new LNG power station project, on which Joseph Muscat’s and Labour’s political future depends.
The question above is fundamental because of the following other questions:
Who may have an interest in controlling Gasol in the future – say for the forthcoming 18 years, this being the expected duration of their ‘deal’ with Enemalta?
Why was the Gasol consortium chosen for the Malta powerstation project when it was clear that Gasol was a cash shell in need of cash and of a business?
Why is Gasol telling its shareholders and the LSE AIM market that it is the leader of the Malta project (see their latest interim report), when in fact it is a cash shell company with no experience at all in projects involving LNG? Why is it leading?
Is there, or will there be, any links to Maltese politics, politicians, or members of the government, behind the control of Gasol?
How can we be sure that none of the other members of the Electrogas Malta Consortium has, or will be taking over, the control of Gasol, thereby controlling the new Malta project?
And how can we be sure that a change, if any, in the control over Gasol was not planned years ago and that it was contingent on Gasol ‘winning’ the Malta project once Labour is in government?
Let us also not forget that Konrad Mizzi told The Times a few weeks ago that the Electrogas Malta consortium will be benefiting from a delayed payment of the Eur 30 million which they owe for Malta Power and Gas Limited – any particular reason for this ‘preferential treatment’?
The Joseph Muscat/Konrad Mizzi government must come clean of any such speculation. Only transparency and public information will clarify this matter.
Gasol’s 2013 annual report has a note on page 53 which says that the main shareholder is African Gas Development Corporation Limited (AGDCL), “a company incorporated and registered in the Seychelles.” Company type, registration details and registered address are not provided.
http://www.gasolplc.com/
So it is the Seychelles and not South Africa.
The Seychelles is known to be a base for offshore companies, with little transparency.
This is now an issue of high public interest.
Now that Gasol plc is becoming a private company, held away from the attention of the regulators at the London Stock Exchange AIM, AGDCL is going to be able to comfortably exercise its control over Gasol as it deems fit with a significantly reduced amount of public accountability.
It follows that our government is dealing with a consortium (Electrogas Malta) that is led by a company (Gasol) controlled in turn by another company registered in the Seychelles about which we have no public information.
Can you believe it: the cash shell Gasol owns 30% in the Electrogas Malta Consortium. And if that is hard to digest, imagine this: in their latest interim report to the London Stock Exchange, Gasol have claimed that they are the “lead developers” of the consortium.
http://www.gasolplc.com/media/18821/gasol_2013_interim_statements.pdf
The consortium led by Gasol:
1. Will be given a contract to supply electricity to Enemalta for the next 18 years.
2. Will supply that electricity at a price that, contrary to pre-election promises, has only been fixed for 5 years – and that is only according to claims made by the Minister of Energy, because so far, the contract which Enemalta has allegedly signed with the consortium has not been published. I do not even believe that such contract exists as yet.
3. Will install an LNG tanker with 140,000 cubic metres of LNG in the middle of the populated Marsaxlokk Bay.
4. Will build a new gas power station in strategic Marsaxlokk.
5. Will supply gas to the BWSC plant which will be owned by China.
Now that I have done this analysis, I cannot resist thinking that Gasol is, or will be, directly or indirectly, owned, by China. This way China will have:
1. 35% ownership in Enemalta.
2. 100% (or similar) in the company that will own the BWSC plant (which will be converted to gas), which will sell electricity to Enemalta.
3. Control over Gasol’s 30% in Electrogas Malta Limited, the company which will build a new gas powerstation and, like 2 above, will sell electricity to Enemalta.
For how can China own 35% in Enemalta and 100% (or similar) of the BWSC plant running on gas, but then have no control over the company providing the gas and the rest of the electricity? And how can China accept to invest in an electricity plant and have another consortium setting up a new plant to compete with it next door? It just would not make sense.
Mystery solved? Over to you, Kurt Sansone.
http://www.proactiveinvestors.co.uk/companies/news/68127/update-gasol-unveils-new-chinese-tie-up-for-african-gas-to-power-projects-68127.html
Gasol has China all over it.
And only 10 employees!
Underhand deals by unprincipled persons with shady businessmen. Could it be any worse?
Which could mean Gasol may be getting some hefty finance from a Maltese bank.
Gasol is just a ‘Cash Shell’ company with no assets and no money.
‘RE: rns Buxton’s wail that investors and lenders are short-sighted. Oh no they’re not. Even the shortest sighted could see that Gasol was being used as a piggy bank by its two owners. Who’d want to lend them money so that they could use it to buy “assets” of themselves? No one in their right mind. I’m surprised the price has held up this much this long really.’
http://www.discussthemarket.com/gas-stream
A ‘Cash Shell’ consists of a company name, a stock market listing, a director or two, some money in the bank sometimes divided into ‘clean’ or ‘dirty’ and whose main value lies in its listing rather than its assets or its business. Several UK investors were burned in a rush of acquisition vehicles launched on Aim, London Stock Exchange’s international market for smaller growing companies, ten years ago. These vehicles had no purpose, were too small and did little but charge management fees.
Cash shell companies often resort to ‘Reverse takeovers’ This is the process by which the smaller, listed company takes over a larger private company, but in effect the larger company ends up in control.
On October 13th 2013, barely eight months ago Konrad Mizzi called this cash shell company as part of the Electro Gas Consortium ‘a truly a world-class bidder’
‘Addressing a press conference at the Mediterranean Conference Centre, Energy Minister Konrad Mizzi said Malta was not accustomed to a selection process of this level.
“The project management of the selection process was unprecedented and never seen under previous PN administrations. Electro Gas is truly a world-class bidder, combining foreign expertise and local investment,” Mizzi said.’
http://www.maltatoday.com.mt/printversion/30638/#.U6vBxLEkS6I
‘Cash shell companies suspended on Aim for failing to do deals.
The companies are so-called “cash shells” that came to the market seeking a merger or acquisition but failed to accomplish one. They were warned last year by the London Stock Exchange that the rules were being tightened and could lead to their de-listing’.
‘Those affected have also failed to raise the £3m required by the LSE.’
‘One such cash shell (is) oil exploration group Gasol’
http://www.theguardian.com/business/2006/apr/04/2
Konrad Mizzi’s credibility is at an all time low, part of his ‘truly a world-class bidder’ is nothing but a ‘Cash Shell’ company which has had a number of previous problems with AIM.
It is now obvious that Gasol’s primary intention is a ‘reverse takeover’ and considering that this would break AIM’s rules it is cancelling the company’s listing.
This delisting is dangerously suspicious, it allows the company to trade with impunity and one wonders who will be ultimately taking advantage of all this.
Konrad Mizzi must explain why a shell company without any assets or money was originally brought into the equation.
One wonders whether Konrad Mizzi was given a proper brief on this company’s background for if he was not taken for a ride then we are.
A couple of crucial questions to be asked to Konrad Fenomenali Mizzi, Joseph Muscat, Alan Buxton or Michael Kunz at this point are:
1. If Gasol is not obtaining financing for its projects – including the one in Malta – from selling shares on the London Stock Exchange AIM, or from institutional investors, where is it going to get the money for the Malta project? Who is putting in the money?
2. Going forward, who will be controlling Gasol plc, which holds 30% in the Electrogas Malta Consortium? Whoever will control Gasol plc will be controlling 30% of the new Marsaxlokk powerstation project if it is ever completed.
The current situation at Gasol should be seen in the light of the exchange between Dr. Marco Cremona and Dr. Joseph Muscat under the igloo in Marsaxlokk in the electoral campaign of 2013.
In that exchange, Dr. Muscat bragged that he was very confident that many business operators will be interested in his power project. His exact words were that he was “ultra konvint li s-settur privat ha jkun qieghed jaghmel pass il-quddiem sabiex jidhol ghal dan il-progett. Konvintissimu..” And he even said that the bankruptcy of the potential operator did not worry him – a rare occassion when he seems to have shown some foresight.
Listen to his exchange with Dr. Cremona from 1.20.00 to 1.24.00 here:
http://www.youtube.com/watch?v=wq1JLtHflOM
One and a half years later, we know that during the expression of interest phase, many big names withdrew from the race.
And now, a claim by Gasol stating effectively that the project was not well received by investors on the London Stock Exchange and by insitutional investors. And Gasol’s share price nose-dived, reflecting this absolute failure.
The prime minister must explain.
If you want to shock yourself further then read this information before it is all hidden away with delisting.
Moreover Alan Buxton, Gasol’s COO purchased 275,000 shares on September 5th, 2013, this is a few weeks before Gasol was officially announced preferred bidder by Konrad Mizzi.
http://tools.morningstar.co.uk/t92wz0sj7c/stockreport/default.aspx?SecurityToken=0P00007YTV%5D3%5D0%5DE0EXG$XLON
“Delisting will free it up from corporate governance controls and reporting requirements.”
This is the way Taghna Llkoll like anything that belongs to them.
Earlier this week, Times of Malta carried an interview with Mr. Kunz, the Malta project coordinator – discussed here:
http://daphnecaruanagalizia.com/2014/06/theyre-going-to-build-a-power-station-by-march-and-they-havent-even-started-yet/
I am still wondering why Kurt Sansone did not speak with Alan Buxton, the company’s CEO. The guy is usually so optimistic and full of “positive energy” about anything that Gasol does.
Back to their reasons for delisting. One of the reasons given was this:
“Gasol is focused on gas projects that have a significant capital value and lead times to development that are measured in years rather than months. The Directors believe that investors in the public markets generally operate on a short-term investment horizon, which is unsuited to the development of the projects that Gasol is focusing on.”
http://hsprod.investis.com/ir/gas/ir.jsp?page=news-item&item=1788602623197184
Now compare and contrast that with an interview with Alan Buxton, available on Gasol’s website, which includes this question and answer:
“Q. Is LNG a long term solution?
A. In a word, no. Although it may be cheaper to run power plants on regasified LNG than liquid fuels, LNG is still more expensive than pipeline gas. But because we will not be able to supply natural gas from our own reserves until 2017 at the earliest, LNG allows Gasol to work with governments in West Africa that are short of gas to develop the gas market. Gasol envisages that having established these opportunities, it will be possible to migrate the fuel supply to pipeline delivered natural gas once it becomes available. Within the Company, we say that LNG is a “bridge” to the long-term solution which is natural gas from the Gulf of Guinea.”
It’s here:
http://www.gasolplc.com/media-centre/qa.aspx
No wonder the markets cannot give any value to Gasol in the long term if they are focusing on LNG terminals in Malta and, as they say, in Benin.
Yet, I find this contradiction in Gasol’s strategy quite unacceptable. On the one hand they focus the company’s strategy on LNG, but at the same time they say that LNG is not a long term solution and then they lament because the market is not valuing their efforts because the market is short term. Go figure.
Unless there is something else that we are not seeing – like a change in ownership and control – Gasol is admitting a failure. I am still not sure about this, though.
Three other things strike me as being strange: Gasol always reports two main projects, Benin and Malta. This begs the question, how long has the Malta deal been negotiated? Was the deal done and dusted since long before MuscatLP acceded to power? Did Gasol or other associated organisations help bankroll the MLP?
Second, Gasol appears to be acquiring several other organisations. Where is the money coming from given it has hardly any real revenues and it has registered losses?
Third, Gasol’s balance sheets report some really weird figures. The classic kick in the jaw is a 3m valuation on goodwill. While, I appreciate this as an accounting practice, what positive “goodwill” could such an unprofitable organisation have?
The big question is: Is it true that they have been doing anything in Benin? Or was it only a mock-up strategy to cover up what they were planning to sell to the Maltese government?
Although Gasol reported that its short term strategy in Benin involved the use of imported LNG, Gasol has frequently referred to working on connecting Benin to the WAPCo (West African Pipeline) in the long term, but it seems that no one with money has trusted Gasol with this plan.
Meanwhile, here is a litte reminder to readers of this website of a link I had posted here some time ago:
http://www.wagpco.com/index.php?option=com_content&view=article&id=113&Itemid=114&lang=en
The snapshot above indicates so clearly why this whole project passed via an expression of interest and not a tender. Thank you, Daphne.
Think about the Gasol shareholders on the AIM – the members of the public who bought shares in Gasol on the AIM. They are the ones who supported Gasol while it failed to trade and to return any profits.
They are now being put in a position where they have to sell for less than half the value of their investment over the past year.
After so many public announcements by the company claiming that it is registering progress in Benin (never seen a picture of this project), in Malta (have not seen any physical development as yet) and promises of a bright future, the public shareholders are now being asked to approve the delisting of the company and, if they decide to sell their shareholding, which they most likely will, they will get half what the shares were worth a few weeks ago when the company was pushing up shareholders’ hopes.
This thing stinks.