Friday 12 April 2013

Section 793 letters

And so the much heralded and expensive process to "out" "fraudsters" has been more or less concluded with the following statement from the CPO board;

"Further to our statement after the deadline for replies had passed, we can confirm responses were received in respect of 42 of the 47 shareholders who were contacted. Of these 42, one shareholder is now deceased, two disclosed an interest of their children in the shares, one parent responded on behalf of a child and the remainder did not disclose any interest of any other person in their shares.

We can also confirm that we are chasing responses from the five remaining shareholders and are taking legal advice as to what action, if any, to take."

There was much glee and anticipation of fireworks when the initial statement mentioned that the board were seeking legal advice and we ourselves were accused of trying to cover up something dramatic. We preferred to wait until we knew precisely what the legal advice was being sought for. Now we know; not much at all as it turns out.  However, it is necessary to examine what we know of this process.

Let's remind ourselves first of all that letters were sent to those holding ten or more shares. Ironically, we are pretty certain that some of those throwing most mud will themselves be in control of a few hundred of the shares in question but we digress. The majority have responded appropriately  - in which case, the matter is essentially closed in relation to them. Five people have not responded, so there are now anything between 50 and 500 shares "unaccounted for". We don't know the precise figures. 

Let us assume for the sake if argument that five hundred shares are now in question (logic dictates it will be far less than that but, anyway..) it would be wrong to presume that these shares are actually used to vote or would be used to vote in a way that supports the club's desire to move to a new stadium. One could inspect the documents as laid out for scrutiny by the CPO board to determine some facts but we would support the board's very firm warning on harassment, abuse and contraventions of data protection (how very sad that such a bleak warning had to be issued). 

We hope the board are able to track down the five individuals and get an answer from them. It would also be helpful to know how many shares are held by these people. The most dramatic outcome will be the removal of voting rights for 500 shares, which isn't, actually that dramatic when you consider the SayNo mantra about 2500 "dodgy" shares. But such action is costly and fraught with dangers.

We would expect the cost of this exercise to have been high and it might have been worth it if we felt it would finally close the matter. We find it bewildering that those who insist on such processes are those who both complain about how much the board spend on legal fees and at the same time attack the board for their efforts to raise funds. A cruel and perverse irony for sure. 

They also object to the selling of more shares - and we have a pretty good idea why - but raising funds and selling more shares is precisely what the board must focus on now. It is difficult to fathom why some people would pursue agendas that could lead inexorably to one outcome; the demolishing of CPO by the club. If they so fervently believe that the club have been trying to influence the work and process of the company, why on earth do they insist on creating the conditions where the club could in fact simply penalise it for not paying its dues?

As we said, it would be nice to think that this exercise will end, once and for all, the toxic share topic but it is inevitable that new theories will emerge. But we will hope nevertheless.

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