ERM an electricity generator and metering company has flirted with the oil and gas industry on both sides of the continent. Metgasco in NSW has been a disaster. It sold out at a huge loss on its investment.
ERM has made it very clear that they want out of the gas industry altogether. It is a matter of days/weeks before ERM are out of EGO altogether.
This is why they should abstain from voting during this AGM because if this poorly structured deal by our current board continues down the path of this 100:1 consolidation it will be catastrophic for the majority of shareholders.
If this 100:1 consolidation gets up then and we sit at 60c to 70c post consolidation it is only a matter of time before the SP falls.
This huge loss again will be felt by every long term shareholder which is currently 70% of all holdings.
If this eventuates it will make a 249D action an almost certainty to proceed as the direct result of anger felt by shareholders.
This is why it is only fair that ERM abstain from voting and continue to sell out of the gas business and not leave shareholders suffering under this dreaded 100:1 consolidation.
The 100:1 consolidation will only benefit the very top of EGO's share register.
A rising share price consolidating from $0.006 - $0.007 will equate to 60c -70c post consolidation.
There will be nobody in the market including speculators who will buy EGO at those prices and expect a return.
Profit taking by buyers who bought at $0.004 and $0.005 will during the Christmas/New Year holiday period when market activity is at its lowest, force EGO's share price down.
All shareholders will lose out, of that there is little doubt if consolidation proceeds.
There is much to take advantage of in Australia's largest gas market with existing gas supply contracts expiring.
Unfortunately the confidence of this current board and their decisions for this AGM have a lack of understanding of long term shareholders' concerns and aspirations for the company.
The present board have not marketed the company nor has it sold EGO's story as evidenced by its window to the world, its website.
Many shareholders have had enough.
EGO Price at posting:
0.6¢ Sentiment: Hold Disclosure: Held
