I think the write down is a clear indication of the lack of security. Why was the security registered only over assets worth 8-9m? Why not insist that the sale be to an entity that had not other registered securities? Did Sargon need it unencumbered to use Diversa as security for the next raise it was making? Why did Sargon put Diversa into an entity where prior security would automatically take priority? Did Sargon know it was in trouble with Taiping and needed to keep them sweet? Did Aaron D'Souza's lawsuit prove to be the tipping point for Taiping?
So many questions ......there won't be answers for a while.
One question that can be answered.....whether there will be a class action! I think a class action would be madness and of little merit. Sue the company because the directors relied on representations that now appear not to have been in good faith. Sue OVH for the failings of Sargon!!
Errors in judgement? Absolutely. Wilful negligence? I don't think so. And loss of value? It only dropped from 35c to 28-29c. A class action would only be of benefit to lawyers. Compensation would only be in the order of 5-6c a share if it were successful.....which it would be highly unlikely. And a class action would know another 5-7c off the share price.....that's in no-one's.
And the mystery buyer? Expect progressive announcements on the ASX.......it's obviously the on-market buyback in full flow
OVH Price at posting:
27.3¢ Sentiment: None Disclosure: Not Held
