It is like extracting teeth. Getting the proven liars at Versarien (VRS) and the morally bankrupt evil PR spinners at Yellow Jersey, of the Frontera fraud infamy, to tell the truth, the whole truth and nothing but the truth is a nightmare. And we are still not there yet. However, the company has been forced to start to clarify. The critical clarification is on its announcement that it had a possible financing deal from China, since the admission raises fresh questions about Neill Ricketts selling hundreds of thousands of pounds worth of shares after announcing the BIGT term sheet last April. This admission surely means the FCA and AIM Regulation have to act to ensure that original term sheet is published in full. Let me explain...
The original Chinese investor was meant to be BIGT (a company with no office, website or telephone number). On 15 April 2019 Versarien announced that BIGT had signed a “term sheet” to buy new shares giving it a 15% stake in Versarien. In September 2019 we were told that BIGT was now working with CIGIU (a company with a very odd website claiming offices around the world including in London which no-one can find) on that investment. On 25 March 2020 we were told that Young-Graphene (Beijing) Technology Company Limited was seeking to procure investors for the shares in China on behalf of BIGT. Natch, we discover today that Young Graphene is a new company with no trading record set up solely to arrange this investment. And that does not ring alarm bells even at clueless Nomad SP Angel of the Mysquar fraud infamy? You will remember that as the shares roofed it after the first BIGT announcement, within one day, Tesla-owning Versarien boss, Lyin’ Neill Ricketts had sold hundreds of thousands of pounds worth of shares at 137p. He claimed that there was no indication of price on the BIGT term sheet so he was free to sell. Hmmm a term sheet which does not include a critical term…. Whatever. And, as Patrick Abbott revealed here, in fact the share price had to be above 150p for BIGT, or those operating in the shadows behind this phantom entity, to invest. The fact that this was never disclosed to investors is surely material in the context of the Ricketts share dump? And so now we are told why it is Young Graphene that is seeking to find investors not BIGT itself investing:
“Due to BIGT's regulatory obligations, exchange controls in China and the downward movement in the Company's share price since executing the term sheet with BIGT, it became unfeasible for BIGT to invest in Versarien at a price level that would have been acceptable to the Company. YG, with the support of both BIGT and CIGIU was established to facilitate, inter alia, an acceptable investment into the Company.”
Those excuses about BIGT simply do not wash. Surely it knew about exchange controls before signing the term sheet? What exactly are its regulatory obligations? And if BIGT could not invest at a price acceptable to Versarien why can the new investors, who are apparently linked to BIGT, do just that? What exactly was in the original term sheet? If AIM Regulation was up to the job it would be forcing Ricketts to publish it in full. The company also seeks to clarify the Lanstead death spiral. Most of a long statement merely regurgitates what has already been said so I assume that morally bankrupt PR spinners Yellow Jersey just put that in to distract investors from the one salient point: costs. If the death spiral does raise £6 million over the next two years – which is in fact very unlikely since it needs a 20 day VWAP of 53.3p for every single month – the net proceeds to Versarien will, in fact be just £5.5 million due to the bloated costs associated with the deal. And since most of those costs are fixed, the lower that VWAP the worse it gets for Versarien.
If, for instance the VWAP were 20p then gross proceeds would be £2.256 million over 24 months but net proceeds would be just £1.872 million. That is the bad news Versarien tries to bury in the verbage. The truth about the Lanstead death spiral is bad enough but the cobblers Ricketts is spouting to explain away the China shenanigans and his own share dealings simply does not wash. Surely AIM Regulation and the FCA must now force complete disclosure. A company that acts in this way is uninvestable. The fact that its business model has never and will never generate a cent of cash is an added bonus for the bears. One day this company will run out of other people’s money but the odds on the regulator ending the show before then look increasingly short.
Filed under: Versarien, Audioboom, Cineworld, Haydale Graphene, Eve Sleep, Gooch & Housego
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