UK 21:44 Monday, 21 September 2026
Breaking news and expert analysis on fast-moving AIM and LSE listed shares
Disclosure: I own shares in one or more of the stocks mentioned. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from ShareProphets). I have no business relationship with any company whose stock is mentioned in this article.
In one week New World Oil & Gas’ (NEW) highly controversial placing and open offer closes. The company expects to announce the result the following day. It then hopes that the London Stock Exchange will admit the new shares to trading on 10 July. This will present an acid test for AIM’s integrity and credibility. Few seem to appreciate the dilemma now facing the London Stock Exchange.
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Comments
drunken sailor
Ben,
I am glad you have not agitated for people to take up the open offer as that would have been totally irresponsible as:
It could have led to the shares delisting and PIs losing everything,
The shares are not worth the OO price.
The motivation would have been to continue the chaos rather than to resolve it.
The term naked short is highly emotive and whilst I agree those who took the placing and sold are now technically in a naked short position, the only reason why they are is because the placing was blocked by shareholders.
On the plus side the company will have more money raised at a better price than had the placing gone ahead. The fact that the BoD remains for the time being means that that money will get pissed away. The level of fees involved in all of this is disgusting.
I think that take up of the open offer will be greater than you think. Having monitored the BBs, quite a few are taking it up, some in the mistaken belief that the short squeeze will still be on and others in the belief that it represents a good way to average down and that once trading recommences they will be able to sell above the OO price – I think they are mistaken in this and will lose even more money as a result.
It will be interesting to see what Chris Oil does. He has sold a large number of his shares, but still retains a large number. I would expect he will take his full entitlement and look to do a deal with Cornhill – he needs the settlement situation to resolve so he can make a massive profit. Whatever his true intention was when he bought those shares in the first place (was he tipped the wink? – I can’t believe he thought he could scoop up all those shares without significantly affecting the price, unless placees were selling prior to the shares being admitted to trading, which was itself reliant on shareholder approval).
There cannot be many people with some sort of interest in the markets who are not aware of what is going on – MP’s have been contacted, so has the Bank of England as has the Financial Ombudsman. Brokers who provide nominee accounts have been bombarded with questions regarding settlement and demands for settled shares to be converted to certificated form to support your campaign. I have no doubt that action will be taken once the whole thing calms down. Whether the right lessons get learned and the right culprits get punished is another matter, I also have no doubt that the action taken will not be made public.
If the Open Offer is oversubscribed, it will be scaled back as they are already issuing the maximum they can without prospectus. As soon as the LSE said unsettled shares had the same entitlement, the sensible thing to do, given that the underlying intent is for the OO to be well undersubscribed so the rest can go to Cornhill to cover what has become a technical naked short, would have been to scale back the entitlement. That this has not happened, I believe, indicates that nobody in authority wants the true scale of the non admitted shares that have been traded to be revealed and scaling back the entitlement would have done that – I do not believe that the LSE does not know the scale of it.
Hopefully the lesson that will be learned is that shares that have not at the very least been approved for admission on a future date cannot be traded in the open market. Hopefully this will also put a stop to the forward selling in the market of placing shares when the placing has not been announced.
Hopefully also those in authority are beginning to realise that PIs do have the ability to make life very uncomfortable, and therefore should not be viewed and powerless cannon fodder.
Hopefully once all this is sorted the BoD will get kicked out and somebody who is capable of making good use of the money raised, less the horrendous fees, will take over, though I have a nasty feeling it might be a BoD linked to Chris Oil and BMD and the abuse of shareholders and the syphoning off of company money into activities that do not benefit shareholders will continue, just under new management!