Broken Colt: Here is more on the conflicts of interest at Colt Resources (TSX: V.GTP, Stock Forum) and why the stock is headed to 3 cents if Nikolas Perrault does not secure a white knight for at least one of its two Portugal projects. And get a quote on the value of the Portugal winery, vineyard and real estate it owns.
Questions galore from our TCR family about the Middle Eastern unit of that company and how Richard Quesnel, former Colt chairman and a aggressive Quebecois investor, essentially now has Colt's Mideast interests to himself and a small group of opt-in shareholders, including Mr. Perrault.
To wit: End of June 2014, RIchard Quesnel buys 4.4 million shares of CRME (Colt Resources Middle East Unit) from Colt Portugal at $0.225 and some weeks later Colt Portugal sells the whole stake at $ 0.05 (about a 1/5). In desperation? In gratitude?
The Middle East flair caught my contrary nature at the time.
CRME gets promised gold & copper and lithium projects in the Middle East, sources tell TCR. The unit seeks participation for a project around portions of the rich H4 project that was once in the hands of Pakistan's Tethyan Copper Co.
Yet the board of COLT winds up selling its remaining ENTIRE CRME stake AT A DISCOUNT in what is clearly another desperate dash for cash, about $800,000 to keep the company going as it juggles tungsten and gold projects in Portugal. This a week ago.
Colt's cash account showed $1.5 million CAD at the close of Q2/13, I believe. Then a placement of equity of more than $5 million with Wordlink in July, and another one -- $2.5 million in October '13 ... and Senior Notes of more than $2.5 million in November. Lots of misfires with some Hong Kong fund that promises to buy Colt shares in an equity placement far higher than the price the stock is trading.
At the close of Q4/13, the cash holdings were $2.2 million. Within the past 6 months, Colt leaves shareholders with a 0% percent stake of CRME and scant cash for bankable feasibility studies for its two Portugal projects. I await clarity on all of this from Mr. Perrault, and I am reasonably sure he will provide it at some point. If he fails that test, I think there will be plenty of Quebecois businesspeople, Canadian friends and European investors who will be waiting for him at the next airport he graces.
I am glad to modify or clarify any poor assumptions or leaps of logic here. In return, I ask for a 40-cent stock price for the 10-cent CAD Colt (COLTF in USA) -- for me and TCR Family.
I am told third=party suitors are looking at both gold and tungsten properties this week, and also that Colt might soon reverse some of the sale of the Middle Eastern unit, or somehow allow Colt shareholders to participate in any wins by that privately held entity.
Declan Costelloe, chief operating officer at Colt and the one employee who can run a mine if he had to, tells us, "I have long believed that the Portuguese assets can be the platform upon which to build a great company and I still believe this is possible despite the challenges. My loyalty remains firmly to the owners of the company and to our shareholders."
Mr. Perrault also tells us from Lisbon this week that he expects to have substantive events unfold in coming weeks. I will hold my breath on this, as I have no intention at this point of selling any of the shares accumulated during the past 3 years. As is my policy these days, amid disappointment, such as the lack of transparency and duplicative salaries we saw at Gran Colombia Gold and other dissolving enttites these past 3 years, I hold. I wait for: 1. a rising tide; 2. white knights; 3. fresh partners; 4. Virgin Mary miracles?
If 1 thru 4 do not transpire, likely we will see worthy regulatory probes and (a waste of energy) classless-action lawyers in suits. In the case of GTP, I will be whole at about 40 cents a share -- 4 times the current price.
I have respect for the work and energy Mr. Perrault, mid-40s and living with his family in Lisbon, has devoted to Colt Resources the past 5 years. Still, the corporate governance there in Lisbon is an abomination, and the spending of company money appears to show consistent lack of discipline.
Please see previous TCRs for more background.
Read more at www.stockhouse.com/opinion/...arty-sysorex#TaQElAHvcFWxTRcx.99