Aug 09, 2010
Shares in social housing maintenance group Connaught (LSE: CNT.L) were sharply lower again as it holds emergency talks with banks over a possible debt-for-equity swap that would wipe out shareholders. At the close 4:35pm: 11.00 p Down ...
8:41, Wednesday 11 August 2010 (Reuters) - Hedge fund Breeden European Partners has more than halved its stake in troubled social housing repairs group Connaught (LSE: CNT.L - news) , after the value of its holding plunged by more than 13 million pounds in recent weeks. The shares finished the day 14.13p + 0.73p
As mentioned in our previous 2 articles we are watching the shares and were possibly interested in entering at 10p or under but if they reached a distressed price of 5p then we might have taken a gamble
The article about the Hedge Fund appears to have strengthened the share price this week but we have seen this before with Erinaceous Group PLC (ERG.L). The involvement of a Hedge Fund is no guarantee of the survival of a Company. Hedge Funds can protect their interests better than the retail investor by "short selling". It is always the retail investor that will be hit the hardest - remember that.
23:05, Friday 13 August 2010 Dominic Midgley reports that Harry Tincknell, a budding racing driver son of Mark Tincknell., Late CEO of Connaught (CNT.L) the website for Harry Tincknell Racing has disappeared. In its place is a simple message : "Apologies for the inconvenience. This site is currently going through development and will be live as soon as possible." Connaught has been telling its shareholders the same thing. Motor racing is expensive (as the author knows having raced in Formula Ford 1600 on a tenth of the budgets of Marc Gene and Pedro Martinez de la Rosa in this Formula in Spain & Portugal). Erinaceous Group PLC lent a director 1.500.000 pounds for a private company of his in a similar line of business as the Public Company. It raises the question as to whether or not there is sufficient regulation of Public Companies whilst trading?
The shares finished the week at 16.47p up 0.39p on Friday the thirteenth
We would still stay clear of this company until it is know what Harry Tincknell did whilst CEO., whether there will be a rights issue or a deal with the company´s banks. If you are a day trader the wild swings might tempt you but the fund is a long term investor.
Graph Courtesy of Yahoo http://uk.finance.yahoo.com/q?s=CNT.L (but take no notice of 1year Target Estimate: Price Earning Ratio or Dividend/Yield - It is history
