It's an interesting question because OBJ has an unusual share...

It's an interesting question because OBJ has an unusual share structure.

Most small listed companies have as their origin one or two shareholders who sell their existing business Into a listed entity. There are several good reasons for this including that they get access to capital and they also have a means of selling a private business which might otherwise be difficult to sell. The former was probably Jeff Edwards aim and the latter was probably Danny's motivation with the proposed sale of Nutrition Systems.

The unusual feature about OBJ was that because it never made any money there was a lot of hype, inflated expectations and capital raisings. Eventually several billion shares were on issue and Jeff Edwards ended up owning only a small holding. It reached the point where no shareholder had a large enough stake in the company to take it by the scruff of the neck and run with it. Certainly Mr Edwards was unable to do that.

For that reason the entry of Steve Schapera and his mates was welcome, but only if their interests were aligned with those of the existing shareholders. Had they simply paid cash for a 30% holding in the company I would have fully supported their commitment. But it hasn't worked out that way.

The proposed Nutrition Systems deal stank and one of the reasons for that was the spotters fee of $1.5 million. Given that the company had barely any cash in reserve, the idea that a person closely connected with the inner circle would pocket $1.5 million makes it clear that the inner circle has interests which are different from ours.

Ditto the fund raising and the issue of options etc to the inner circle and their mates. Why on earth were Danny and John Palermo included in that group?

Don't get me wrong I am a fan of Mr Peros' and completely support the fact that he is now the MD and is pushing ahead with Reduit.

But ordinary shareholders need to be wary of a Board and its hangers on who are now the only organised group on the share register and who can now push through whatever special deals they like.

The risk for ordinary shareholders is that OBJ shareholders tend to suspend disbelief and swallow whatever nonsense they are told.

Unless we smarten up we may find that the fruits of success, should they arrive, may escape us anyway.