EightBlack.

Something really smells now.

News today via the ASX website is that the beleagured digital conglomerate has sought additional time (on top of the original extension) to try and work out just what is under the hood, so to speak.

You can bet your bottom dollar that there’s consultants in there from one of the accounting firms, who specialise in insolvency.

Via their ASX statement:

“Further to Bluefreeways request for voluntary suspension on May 7th, the company is seeking an extension to the voluntary suspension of its securities”

(Translation - the insolvency experts and forensic accountants are only halfway through their audit and all is not looking well. The words “trainwreck” and “carnage” have often been used these past 2 weeks and the remaining finance team are swearing louder than Gordon Ramsay)

Their ASX statement continues to mention how the current investigations are reviewing their accounts to June 30 as well as looking for further capitalisation options and that once all is said and done, we should be able to give you something definitive in the next 2-3 weeks.

Or something like that.

If you were a cynic (or a shareholder), you wouldn’t be impressed. In fact, each and every shareholder is completely hamstrung and unable to do anything until quite possibly its too late.

I really feel sorry for all those local companies who did a 50/50 deal for cash and stock when the fast talking Bluefreeway guys came along. There’s not one who wouldn’t be regretting their decision to sell.

Because if the core group goes pear shaped when they do finally make an announcement to the market, each and every company won’t be able to do anything. Potential buyers of the carcass (or carcasses) will be negotiating with someone from Ferrier Hodgson rather than the founders of the individual brands.

I’ve never heard of a company requesting an extension to a trading halt who then re-emerges completely unscathed.

Something is definitely up.

And I think the management of Bluefreeway owe it to their shareholders to be straight-up and tell them whats going on. In back and white. Not shades of Blu.

After all, you don’t need to be a rocket scientist to work it out. The audit and subsequent investigation can’t possibly take 3 full weeks to complete.

I hope I am wrong. I hope that whatever the announcement in yet another 2 weeks will be positive.

But I doubt it. I’m going to do some digging. I’ll keep you posted with what I find out (that’s if anyone is prepared to talk with me).

Let’s wait and see.

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This entry was posted on Wednesday, May 21st, 2008 at 10:35 pm and is filed under News. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.