Note to MODS: I think this post of of use to the GGP community...

Note to MODS: I think this post of of use to the GGP community on a number of levels. Not cross promoting. In fact this is a word of caution - IMHO just stay with GGP if you want GGP shares!


Hi Blueballs and others,

I did a fair bit of research on the weekend. At first AKW seemed like a great backdoor play to get some cheap GGP shares. Then as I looked at AKW is seemed like fantastic value in its own right. Then as a looked deeper there seemed to be all sorts of funny related party transactions that I feel very uneasy about. About 5 mins ago, I pulled my order for AKW shares.

Research notes below. DYOR. Buying AKW may be play of the year or a horrible mistake. Hope it helps whatever you decide.


AKW
- approx $3M liabilities ($400K to be paid in May 2011, rest non current)
- approx $3M in cash (still in transit from MDA?)
- $3.5M in loans and convertible notes to MDA
- 107M shares in MDA ($2.7M worth)
- New Caledonian assets (bought for $2.4USD, may sell for $8M AUD to GGP)
- Market Cap $4.7M (trading close to lows at 10c per share)
- 1:1 rights issue upcoming at 10c ???

MDA
- Have aquired Blackgate Resources for $24M USD
- Trading at $24M AUD (lows)
- Not much cash - will likely need Cap raise
- Aquisition of Blackgate was a convoluted and risky play. Also very expensive relative to Market Cap. Why so desperate - is it that good or did it allow the owner of Blackgate to cash out with $24M and laugh all the way to the bank....

Too Many "Blacks" (and other funny connections)
- Blackgate was the Major creditor of BNP which is the company in Chapter 11 Bankruptcy at Padre Island.
- BNP was started by Barbra 'N' Paul (BNP) Black. Blackgate has relationships to Paul Black.
- On 26/5/10 a new board came to AKW (old members all left). One of the new board members is Paul Blackman (aka Paul Black??)
- MDA board is also pretty much all new as the tack Padre Island
- Doug Jendry was at MDA, now at AKW
- Tony Izelaar was at AKW now at MDA
- Offices of AKW used to be used by MDA
- No directors of MDA or AKW have significant skin in the game.
- Share price of both companies has been heading south rapidly. Will the phoenix rise from the ashes?



As far as GGP goes, my conclusions are:
- if I want GGP shares I'll get them on market, thanks!
- I highly suspect these GGP shares will be dumped on market so I'm not buying now
- the New Caledonian assets are being dumped by the new board to free up cash to do whatever they need to do with Padre Island. I hope they are worth the $8M SG intends on paying.....
- The New Caledonian assets seem expensive to me - look at AOK for a company doing well enhancements and in fills. They seem to get the leases for much less. The strategy (low risk cashflow base) is sound. I just question the price.

Dis: No sentiment. Too many questions