Category Archives: Ukategorisert

Summary: Aphria Inc. (NYSE:APHA) Yesterday Aphria received a ‘hostile’ takeover offer from a company called Green Growth Brands Ltd. (“GGB”), which aims to acquire Aphria in a C$2.8 billion all-stock deal. GGB’s second largest shareholder is a fund sponsored by Green Acre Capital, a firm that lists none other than Aphria CEO Vic Neufeld on its board of advisors. Aphria has invested directly in the fund and therefore already owns a significant stake in GGB. GGB recently listed a current Aphria board member on its own board of directors. Other recent GGB directors have obvious affiliations with Aphria and its related persons. GGB was formed this year, has almost no revenue or tangible assets, and has limited operations. Despite this, its newly-listed, thinly-traded stock has spiked to a market cap of ~C$890m on average daily dollar volume of only ~$1.3 million. In short, we think GGB is largely a worthless…

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Summary: Sky Solar (NASDAQ:SKYS) A key lender recently noted SKYS to be in default, but shares spiked on a company press release indicating that the lender proposed to buy SKYS for $2.15-2.25 per share. Retail investors seem to have taken the release at face value, but court filings show that those proposals were actually withdrawn after the lender learned of a new $121m liability. Instead, the lender has begun to seize SKYS assets, including a significant Luxembourg subsidiary which it has now fully appropriated. The company’s financial state was weak prior to the new $121m liability and the recent note default. SKYS has had 3 CFOs within the span of 6 months. We expect the stock to dive as retail investors realize what’s actually going on. SKYS looks to be approaching insolvency and we do not anticipate the equity will survive. Introduction An interesting thing has happened with Sky Solar…

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Yesterday, Eros’s key Indian operating subsidiary had its credit rating lowered 10 notches to “default” by CARE ratings, the second largest Indian ratings agency. The issue, according to CARE was “a slowdown in collection from debtors”. The default occurred just as we were completing an investigation that sought to explain precisely why Eros has been persistently unable to collect receivables from its debtors. After extensive on-the-ground research in India, interviews with multiple former employees, and a detailed review of Indian private company filings, we believe the underlying problem is that a significant portion of Eros’s receivables don’t actually exist. We have uncovered details of highly irregular related-party transactions. For example, Eros has directed $153 million to a supposed production company based in tiny office located in what looks to be a rehabilitated Mumbai slum. The entity is operated by the brother-in-law of Eros’s Chairman and CEO. We have also documented…

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Predictive’s key original holders and recent Chairman/director have previously been charged by regulators with securities fraud, including allegations of pump and dumps, boiler room sales, and false press releases. Predictive’s CEO Brad Robinson has a checkered history, including allegations of securities fraud and of non-compliant marketing of a medical product. Predictive has embarked on a flagrantly suspicious acquisition spree that displays hallmarks of insider self-dealing. Specifically, 4 of Predictive’s 7 acquisitions were entities based out of Predictive’s own address before they were acquired. Predictive’s revenue is derived almost entirely from sales of stem cell products, a business that appears to be predicated on (i) sourcing birthing tissue from pregnant women who wrongly believe they are donating it to purely non-profit causes, and (ii) aggressive “miracle cure” sales tactics targeted toward elderly customers suffering from chronic pain. We attended a sales seminar held by one of Predictive’s largest distributors, run by a doctor…

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