http://www.businessday.com.au/business/grey-knight-to-stirlings-r...

http://www.businessday.com.au/business/grey-knight-to-stirlings-rescue-20090312-8wjd.html

The above website is about STI and Peter Boonen. Yes i know its old news since March 09. But still worth the read to the newbies who bough this stock. I am pasting it here for the lazy's ones:


ONE thing Lancelot can always appreciate is a white knight, although in his experience most corporate knights come in varying shades of grey.

A year ago Peter Boonen's Zodiac Capital put up its hand with a generous bid for listed stockbroker Findlay Securities, only to pull out when the Opes Prime debacle and its aftermath left quite a few of the broking group's clients in a financially fragile state.

Backing off must have generated an interesting discussion in Zodiac's boardroom, where Boonen is managing director, because his chairman, Robin Armstrong, was also a director at Findlays.

Now Boonen's apparently riding to the rescue at Stirling Products, which until now has been trying to corner the pet health-care market, with a plan to inject one of Zodiac's four project assets into it.

His relationship with Stirling goes back to its re-creation from the shell of West Oil in 2004, and he was in fact approved to become a director, but never joined the board.

He was, however, instrumental in bringing to Stirling its main asset rights over the use of an agent called R-salbutamol to produce products for reducing weight in domestic animals.

In exchange, he wound up with a fistful of Stirling shares, although over time he has sold down.

Earlier this year, Boonen received a phone call warning him that unless something happened quickly to undo its fiscal anorexia, Stirling was headed for the knacker's yard.

Last month the old board and management stepped gracefully aside and in swept Boonen, along with Zodiac's company secretary, Gulshan Jugroo, and the head of specialist broker Alpha Securities, George Karantzias.

Their arrival coincided with a much-needed small capital raising, run by Alpha, of $260,000, to be followed by two separate convertible note issues to punch a further $1.5 million into the coffers.

This week Boonen, who is now managing director of Stirling, revealed the corporate plan was to bring together R-salbutamol with Zodiac's Zocap neutraceuticals and natural medicinal products.

That will take Stirling out of animals and into humans, with Boonen planning to offer a suite of products in "sexy" treatment areas such as obesity and tuberculosis.

TB might not be big in Australia, but it is a real issue in developing countries and Boonen is off to South Africa shortly to try to get the product a market.

There is, he says, some evidence the TB treatment has effects on patients with HIV infections, although Lancelot has heard such claims and seen them turn to ashes more than a couple of times from listed companies.

The deal's current structure requires Stirling to spend up to $1.2 million over two years developing the markets for Zocap products, in order to win a 30 per cent stake. For $1 million more it can buy another 10 per cent, and by issuing 150 million shares to Zodiac, 10 per cent more.

Zodiac would then own half of Zocap, theoretically enhanced in value by the cash Stirling is expected to put into its development, and a fair slice of Stirling.

The Zocap venture is one that Boonen latched onto last year through a Russian pharmaceutical connection who told him of the Ukraine-based group Ekomed, which licensed its range to Zodiac.

Lancelot must go on a small sidetrack here to point out that Zodiac is listed, but rarely traded, on the National Stock Exchange. It put out a statement in early February, the day before Stirling announced its own restructuring, that implied Zodiac was undergoing a controlled liquidation to get a return on the $1.8 million it had put into its investments.

"The company advises that it is in negotiation and discussion regarding the commercial realisation of each of its four major project assets and is seeking to achieve realisation and resolution of its affairs within the next 90 days," the statement said.

Any company listed on the Australian Securities Exchange that published a statement like that would, at the very least, find their shares suddenly had a lot of sellers.

Like almost everyone, Zodiac was caught short by the market's rapid decline. The offer for Findlay was really intended as a way to list itself on the ASX.

Intriguingly, Boonen reckons that when Stirling discussed the Zocap deal with the ASX, the exchange's initial view was that shareholder approval may not be needed because he did not actually control Zodiac.

The ASX is apparently having another thought on that, which Lancelot can only commend.

Boonen might see himself as a benevolent benefactor, giving Stirling the touch of entrepreneurship to get its products to market that his more scholarly predecessors could not, but small shareholders deserve a chance to be better informed of what is happening with their company little things like making it abundantly clear when the Zocap venture was announced that Zodiac is associated with two-thirds of Stirling's board.

While Stirling was undoubtedly struggling, control and direction of the company has changed without them getting a cent, or a say, as yet.

[email protected]

Source: The Age