How do we know when irrational exuberance helps the value of a company's securities remain inflated?
To play devils advocate I thought this thread would be a good place to provide an answer, so let's take a quick walk down memory lane;
01/08/2014 - Option to Acquire Australian Cloud Services Provider
16/09/2014 - Update on Cloud Lands Transaction
16/10/2014 - Cloud Lands Secures Two Milestone Agreements with Fujitsu
06/11/2014 - Resignation of Director
13/11/2014 - Option to Acquire Cloud Lands Exercised 09/02/2015 - Termination of Agreement to Acquire Cloud Services Provider 23/04/2015 - Acquisition of Interest in Sugar Dragon Limited
20/05/2015 - Update - Sugar Dragon Acquisition
22/05/2015 - Candy Crush Confectionery Sales gain solid momentum 30/06/2015 - Termination of Agreement to Acquire Sugar Dragon Limited 31/07/2015 - Board Appointments and Resignations
03/12/2015 - SRT Chairman dumps 33m on market (Red Rock)
03/12/2015 - Section 249D Requisition Notice to remove Chairman
10/12/2015 - SRT Chairman Resigns
10/12/2015 - SRT Chairman discloses sensitive information to the public*
11/12/2015 - Company is made aware of information disclosed to the public and takes no action
Given the above sequence of events, we can assume that the Company haven't been very successful in its attempt to execute reverse merger deals, or perhaps they just like making RTO announcements before terminating them? One will need to exercise some caution commenting on the latter, so I'll restrain myself on this occasion.
What should be quite apparent however is that the Company took no action after *alleged material information was drawn to their attention. This would indicate to a reasonable person that the information leaked by the outgoing director was most probably made up of fluff, otherwise the Company would be in breach of its continuous disclosure obligations under ASX rules 3.1 - 3.1b. Whether information has the quality of being confidential is a question of fact, not one of the intention or desire of the listed entity. Accordingly, even though an entity may consider information to be confidential and its disclosure to be a breach of confidence, if it is in fact disclosed by those who know it, then it ceases to be confidential information for the purposes of listing rule 3.1A.2.
Unless the requirements in all three of Listing Rules 3.1A.1, 3.1A.2 and 3.1A.3 are satisfied in respect of particular market sensitive information, Listing Rule 3.1A does not apply and the entity must disclose the information immediately under Listing Rule 3.1.
The reasonable person test is an objective one. It is to be judged from the perspective of an independent and judicious bystander and not from the perspective of someone whose interests are aligned with the listed entity... ~ Source
Now we've cleared that one up let's investigate the sensitive fluff stuff further to find the motive;
RRR dumps just enough shares to leave it below the threshold required to report on a form 605 (substantial holder notice)... Hmmm?
Those same shares were also valued at AUD$1,324,300 in Red Rocks' books back in 2013, but that doesn't have much to do about anything either - The fact of the matter is that Red Rock have now booked a -50% loss on the initial value of those 32.3m shares
Translation: Trust me, I'm never ever going to sell another share in Star Striker, and I guess the only reason I would be telling you this is because, um, I'm just a super nice guy with lots of integrity!
Translation: Did I already mention that I'm never ever going to sell another share in Star Striker?
That wasn't too difficult - has anyone stayed at the Banyan Tree?
(20min delay)