Here is the complaint I have lodged tonight with the ASX via their website:
As a shareholder of Roto-Gro International Ltd (ASX:RGI) I wish to formally register my complaint at the ASX's change in position regarding the acquisition of 51% of 420 Inc. This deal was announced to the ASX on 31/10/2019 and approved by shareholders on 29/11/2019 at a meeting of shareholders subject to the closing conditions of Health Canada issuing a cultivation licence to 420 Inc.
There is no indication that the ASX had any problem with this acquisition until the final term for the agreement was completed by Health Canada issuing a licence to 420 Inc on 12/3/2021.
Given that the ASX did not believe previously that this acquisition would constitute a change in the nature of the company why has this view changed?
In light of the prior acceptance, express or implied, by the ASX of the acquisition of 51% of 420 Inc the company had announced on 31/10/2019 and continued to make the market aware of via subsequent market announcements and presentations, any investors purchasing RGI shares would have done so in anticipation of the deal going ahead, once 420 Inc was issued their cultivation licence by Health Canada.
The nature of the RGI business is to produce and sell automated rotary hydroponic garden systems. This continues to occur through deals that RGI have made prior to entering the deal to acquire 420 Inc and have continue to make, most recently with Canniberia and Verity Greens. The arrangement with 420 Inc presumably would also result in the production and sale of automated rotary hydroponic garden systems to 420 Inc, as such the nature of RGI's business has not significantly changed.
The ASX, by withdrawing their acceptance of this deal, has resulted in a false market in the trading of RGI shares from 31/10/2019 to 12/3/2021.
The remedy I seek, as a shareholder in RGI, is for the ASX to reintroduce it's original acceptance of this deal, subject of course to the shareholder vote on the issuance of shares in RGI to the principals of 420 Inc as consideration for the acquisition.
I encourage all current shareholders and those that owned shares between 31/10/2019 to 12/3/2021 to lodge a complaint via the ASX website:
https://www2.asx.com.au/about/contact-asx/customer-feedback/feedbackWhether you copy my complaint or use you own words is up to you but we all need to take action if we want this deal to go ahead as planned.
