Shareholders attack Cityview’s ‘dirty tricks’
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The directors and shareholders of oil and mineral explorer Cityview Corporation are at loggerheads over what some investors are calling “dirty tricks”. Perth-based Cityview, which touts exploration interests in Angola, Cameroon and Indonesia, has seen its shares tank from 36 cents in late 2007 to less than a cent a year later. While the global financial crisis is being blamed, the real reason is a complete loss of faith in the actions and integrity of Cityview’s board, a group of disgruntled shareholders claim. The group, which refers to itself as “the collective” is run by small shareholders Steve Coughlan and Sue Turner. The group came together after a number of investors started posting to sharemarket forum Hot Copper and now the run their own website. The collective claims that mum and dad investors who were convinced Cityview was their path to riches have lost hundreds of thousands of dollars each. Managing director Mark Smyth however dismisses the collective’s claims as defamatory rumours. “The scramble for resource rights in Angola is intense,” Smyth wrote in an e-mail that has now been posted to Hot Copper. “This task is made doubly difficult by the internet chatterers who follow like sheep every scurrilous rumour spread about our security of title. The continuous negative comments from the chatterers are the primary reason why the Cityview share price remains at the current low level.” Smyth said over the phone that these Internet chatters have been making the same claims for months. “We had this whole furphy six months ago and that had all been put to bed I thought.” “I can’t waste my time commenting on the Internet. At the end of the day what matters is you do your work, the auditors come in and sign off and you move on.” Smyth also suggests that there may be more sinister motives afoot. “I’ve realised over time that we have a lot of opposition in Angola. We’re probably now the biggest land-owner, there’s a huge amount of competition out there are some of these Canadians are absolutely ruthless. They’ve discovered that all you need to do is create a rumour on Hot Copper and create a bushfire. I won’t mention names but there’s one particular guy and he’s first class and he’s ruthless. It’s just like chucking a hand grenade in.” But at the core of the issue, claims the collective, is that Smyth and his co-directors, which include the former Angolan minister for mines as chairman, are making promises they can’t keep and are now making moves to fire sale the company to a small group of preferred investors. Coughlan says that several “bizarre” share placements have been made to a group of people associated with London-based Global Investment Strategy (UK) Ltd. Similar tricks have allegedly been used to silence dissent. “Due to a loophole in ASX listing rules the company has found a way to issue new shares at their discretion,” Coughlan says, “enough to double the outstanding share issue and potentially defeat all votes by placing shares with friendly parties.” Coughlan says this is a David versus Goliath battle. “In essence it is about small shareholders fighting back.” Yet the outcomes rests on whether the dissidents can muster enough votes for the Extraordinary General Meeting January 30, or whether ASIC rides to the rescue. “If we can succeed it will set a new precedent, it will put dodgy directors on notice that they can be held accountable by shareholders,” says Coughlan. “If we are publicly defeated it will strengthen the perception that the little guys can’t fight back against corporate heavyweights.” Global Investment Strategy’s shareholders and directors are John William Gunn and Ian Hugh Van Stratum. Gunn and Van Stratum are respectively in charge of Saphi Asset Management and Pinnacle Capital Management, two other companies Cityview has been doing deals with. The CVI Shareholders website says that Cityview’s board is effectively giving away the company to this group of London merchant bankers. Then again, it is also suggested – whether by cutthroat Canadian entrepreneurs or legitimate sources — that Cityview doesn’t even legally hold some of the mineral concessions in Africa it claims. If so, what exactly is there to give away? |
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8 Comments
I feel CVI has a lot to answer for and share price has dropped by half again since the publish date of this article. Smyth clearly is a complete rogue no promise he has made seems to stick promise after promise year after year, everything he says should be researched rather than taken as a verbal. Every asset should be questioned and true title established. Every plant and company structure should be independently verified for accuracy. His lips flap and make a sound nothing seems to stand up. Major institutions that have recently purchase these shares are selling out quickly and at loss - why?? Research is the key to sound investment advice.
Whilst all stocks have been hit hard recently it is clear CVI is not liquid and still hasn’t hit bottom. They use pictures of equipment they don’t own and will never own, they lay claim to titles that aren’t in their name. Their game is to swindle share holders out of their investment money not to actually build or develop any assets. One need only to look at the amount of dilution they have created in the last year alone. Money from sophisticated investors never seems to be accounted for properly it is given away to companies that then are released to associated parties for no transfer of asset or value to shareholders and no independent auditors will verify their claims.
When you read stories from CVI about liquidity and you look at the chart of recent action you see it is liquid and the plug has been pulled so clearly your liquidity is only going one way – away from you, down the drain. Check the performance on charts.
Trends follow trends – those who wish to be rich in a day will be poor in a week.
Stay away but good luck – all of the above is my opinion only. Research, research, research.
Carlita,
One can only say that your arguements look a little insubstantial
when compared with those of the collective, and your syntax little better.
Of course English may not be your native language, so good on you for having a go.
In fact, encore, encore!
I am one of the Shareholders Collective,
For further background,go to http://www.cvi-shareholders.org/jms ,and also follow the link to http://public-exhibition.zoomshare.com/1.html.
Some rich pickings there for Investigative and research types,
I have investments in speculative stocks, and only have myself to blame for losses.
However,CVI is an outstanding example of convoluted management ,and obfuscation.
The Collective wants to instil transparency and value to the company, as notwithstanding the current world economic circumstances, it has , in my opinion been exceedingly poorly managed, wether by design or accident, the actions taken by us will ultimately determine.
Bozwell
Wow! Time more shareholders took up the challenge to show all the corporate cowboys out there that they’ve had enough.
These jockeys running public companies need tightener reigns. Someone needs to buy new teeth for hte regulators and step up the rules a bit. Perth people know the sleazy reputation pretty well, and where there’s smoke, there’s often fire, and where there’s no fire, there’s mirrors.
Go shareholders. He’s going to stuff you with writing shares, had a look at it, but the media will watch him for you now, and you may be doing a great service to other spec comepany shareholders who own little but hot air. Good luck.
The current very organised and circumspect efforts of the Cityview Shareholders Action Group in demanding this imminent EGM deserves the highest praise.
It is high time company excutives, whatever the company, should realise that running a company is not a game for their own benefit, that any sich company is not their prsonal plaything, and that shareholders are actually the owners of the company, who are prefectly entitled to demand the highest standards of reporting, auditing, and clear explanations of “where has the money gone” or will be going.
This generalised pervasive disdain for shareholders and their subsequent financial welfare so evident with so many companies, large and small, has gone on for too long, as evidenced so clearly in the current world financial crisis. It is time for those who run any public company soliciting shareholders funds to be forced to be fiscally and transparentally accountable to those who have supplied such funds in may cases are so often carelessly “throw naround” to their own advantage, without feeling the need to explain their actions to their shareholder investors, whose views they seem to despise..
By calling this Shareholder Action EGM in this particular case concerning CVI, investors are demanding transparency, and the truth with regard to the current standing of the company’s future prospects.
Not an unreasonable request, surely. All we are asking is for the truth.
Mark Smyth is quoted above: “At the end of the day what matters is you do your work, the auditors come in and sign off and you move on.”
In just one of many controversies with this company we know that $1.8 million was paid as a deposit for shares in Turnberry Resources, a company who allegedly held a Cameroon oil exploration license. It later turned out that another company owned this license and Turnberry’s license had been cancelled months earlier:
On 28th June, 2008 the auditor BDO Kendalls stated: “We have not been provided with sufficient evidence to satisfy ourselves as the recoverability of this balance, nor have we been able to perform sufficient and appropriate other audit procedures”
Subsequently the $1.8 million was written off without comment, and BDO Kendalls were replaced as auditors. Cityview moved on.
Here is a news article (with permission from the editor) on the “confusion”.
African energy magazine Issue 124 • 19 October 2007
“CityView’s claim to control the Matanda block has caused confusion in Yaoundé, where the national oil company says the licence will go to Glencore and Afex.
Cameroon’s Société Nationale des Hydrocarbures says it is negotiating with Glencore Exploration and Afex Global on a contract for the Matanda block, PH-72.
The block had been licensed to Turnberry Resources of Canada, but their permit was cancelled in January because they had carried out no work on the block.
Perth-based CityView Corporation says it has acquired a controlling interest in Turnberry, which it claims gives it rights to a 40% share the block, but Simon Tamfu, director of exploration at SNH, told African Energy he was puzzled by CityView’s announcement. He said Glencore and Afex had emerged as preferred bidders when the block was retendered earlier this year.
“We don’t know CityView,” he said. “We knew Turnberry but we cancelled their permit in January.”
African Energy Magazine article cont’d:
“Asked about SNH’s comments, CityView denied this was the case. “The information is totally wrong, the president is investigating,” CityView chief executive Mark Smyth told African Energy.
According to Smyth, the other shareholders in PH-72 are the government of Cameroon and a company named African Business Group, both with 30%. Condensate was discovered on PH-72 (the former OLHP-3) in two wells drilled to a depth of 3,000 metres by Gulf Oil USA during the 1980s.
CityView said on 3 October that it had bought the rights to buy 100% of Petro Energy Africa, which it said was the beneficial owner of 57% of Turnberry Resources. It said that the controlling stake in Turnberry would give it operational control of the North Matanda oil field. But Tamfu said this was not the case. He said it was quite normal for licenseholders to bring in partners, but such arrangements would require government approval, and in any case Turnberry was no longer the PH-7
I’m a shareholder of Cityview but, I decided to not be part of the Shareholders Collective. I find quite disturbing the way some of the members go about on share forums and put down a company on times where RIO TINTO is a 5th of it’s share price ! We’ve finally got a proper team set up with Manuel, got interest from Nigeria with our refinery and people out there wants to run the company as they think ? Contacts is everything my dad always said. We’ve got it. Now, let’s go thru this horrible economic times and when we are at the end of the tunnel, commodities will surge first than any other industry as shut downs are taking over every industry, commodities will be in demand.
We will be on top once again and all mining stocks will be winners.
Now, stop your anger about this company and take in your own decisions on your investments.
I want this company to succeed in the future and I am sick of all the doom and glooms of the media lately not to say about all these people trying to destroy the company and also trying to capitalise getting into the board.
All my regards,
Carla