UK 00:03 Tuesday, 22 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.
Since arriving in Jersey yesterday morning, it is clear that whatever happens at New World Oil & Gas’ (NEW) EGM today the aftershocks of this fiasco will continue to be felt for quite sometime. New World has 702million shares in issue, yet in the twelve trading sessions after the company announced its unconfirmed placement somewhere between 6.5billion to 9.5billion shares exchanged hands. So far the authorities have largely washed their hands of this mess, but sooner or later it is going to dawn on them that they cannot ignore it indefinitely. Heads have to roll.
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Comments
Marvin
Any sign of Judith ?
Peter
What’s the betting that the authorities will do absolutely nothing?
wildrides
Thoughtful piece Ben . Personally I disagree strongly with Tom on this subject ……. ie I hope that the naked shorters really cop it for a change . Even if it does wipe them out . The argument that many did not know they had entered a trade ( according to Tom ) just does not wash . Only those with discretionary accounts may not know ……….. but they signed that right over to their fund manager anyways ……….. so sue him if he broke laws or fund primary rules with naked shorting . Non discretionary clients only have themselves to blame . Do your own research and know your risks I say , and never let others naked short with your funds . Toms position looks increasingly wrong and yours right, as more time goes by. No doubt I will cop a load of verbal four letters from him for my view on the matter . Whats more BMD ,s personal attack on you was deeply offensive . I was very perturbed that your SP colleagues did not come out and wholly condemn BMD for publishing such offensive remarks . Ok so Tom was pre occupied with personal issues ……….. fair enough , but the others were too quiet . Dont be a Bully BMD …………..its not clever or funny .
DKM
From Penny Sleuth today:-
The B&B owner who accidentally
bought an oil company
Every so often the penny share world throws up a story that’s stranger than fiction. The strange case of New World Oil & Gas is one of these.
After all, it’s not every board of directors that feels the need to warn investors to “exercise caution in dealing in the company’s shares” at the bottom of its stock exchange announcements! Given the current state of play at New World that’s a fair warning (and it has nothing to do with the usual operational risks you expect when speculating in a tiny oil exploration company valued at around £2m).
The excitement started a few weeks ago when a 76 year-old guest-house owner from Malvern emerged as a potential bidder for the company. This was the result of what is technically known as a “cock-up“…
For the love of god, get your sums right
Mrs Williams’ son enjoys punting in junior oil stocks and bought 342m shares at the end of April in his Mum’s name – which he thought represented a 10% stake in New World. Unfortunately he’d got his sums wrong!
New World is in the process of doing a placing of new shares to raise £1.5m cash. This will quintuple the number of shares in issue from the current 702m to 3.5bn. The problem for Mrs Williams is that she will own 10% of the company after the new shares have been issued. This is subject to approval at a shareholder meeting that takes place today. When her son bought the stock, he actually acquired 48.7% of the existing shares in issue.
According to the UK takeover code this means that Mrs Williams has to make a bid for the entire company. Anyone who goes over the 30% ownership level has to make a mandatory offer to other shareholders. This has to be pitched at a price no lower than the maximum paid during the last twelve months. So it looks as if Mrs Williams could end up running a hotel and oil conglomerate!
Burnt fingers all around
What should be done in the case of Mrs Williams? Here the plot thickens.
One question that might have occurred to you was how on earth could someone buy almost half a company in the open market in a short space of time? After all, the share price didn’t go up in the days when that huge stake was being acquired.
The reason for this is that Mrs Williams’ son was buying shares that didn’t actually exist. Let me explain.
After the announcement of that major fundraising, more shares traded in the market than were in issue. How was this possible? People were selling shares (presumably to Mrs Williams) that they didn’t own. They wouldn’t be able to deliver their stock on the normal two-day settlement cycle; so they agreed extended settlement terms with their brokers. They expected to buy some of the massive number of new shares due to be issued in the placing and use these to settle their sell orders at a later date. By selling now at a market price well above the placing price, they hoped to make a few quid.
A couple of interesting things have now happened. The Takeover Panel has ruled that Mrs Williams only owns shares that have already settled as far as the 30% rule is concerned. This looks like letting her off the hook in terms of bidding for New World. It gives her time to reduce her stake before all her previously purchased stock gets delivered.
However, those delayed sellers of New World shares might have an equally big problem. If the shareholders vote against the placing today, then those 2.7bn new shares won’t be issued.
Which could mean the sellers are forced to buy shares in the market in order to get the stock that they’ve already sold. This is known as a “short squeeze”. The speculators who made those delayed settlement sales could end up with badly burnt fingers. New World has said it will seek other ways to issue new shares and avoid the squeeze if the vote goes the wrong way. After all, it wants the extra cash.
This is all hugely entertaining and it will be interesting to see how it plays out. However there’s no getting away from the fact that it’s a bit of a fiasco all round. It’s the sort of thing that doesn’t do AIM’s reputation much good.
Best wishes,
David Thornton
The Penny Sleuth
DUCK AND DIVE
What the Wild man said.
UpandUnder
Ben, once again you’ve gt this spot on. You’ve called this right all along, and like Wildrides I was very disappointed to see a distinct lack of support from your fellow writers. Tom, is plain wrong on this one, I just can’t understand his stance. BTW, the spread on expletives for his response is 3-5!
TW note I called for suspension on day 1, flip flop disagreed then agreed, so it is not like we were 100% apart. Ben knows full well how much I have supported him in expressing his views and against the shoddy attacks on him.