Kinovo Share Discussion Threads

[kinwah] 13/7/2022 12:29

Any claim of misrepresentation is going to struggle with the 'entire agreement clause' in the sale and purchase agreement. There should also be various indemnities and remedies in the SPA. Simply, I can't see KINO winning their claim for misrepresentation which probably refers to MCG taking on the parent company guarantees - at least not without several years of litigation. We're all in the dark but there will be a sizeable hole in the KINO balance sheet which will need plugging.

[gerry pacemaker] 13/7/2022 11:27

Yes Nick I agree but how on earth did they fall for selling DCB to an outfit like MCG Global? I note the last RNS mentioned they we are pursuing a claim of misrepresentation against MCG and "associates". So I wonder who these associates are and is the misrepresentation fraudulent? Either way in my opinion it's clear to me the purchaser(s) of DCB were never in a position to run this asset profitably.I'm very disappointed in David Bullen and whoever was responsible for checking the purchaser out beforehand. Will we ever find out what went on? I'm happy to hold purely on the basis the core business is excellent.

[nico115] 13/7/2022 08:49

9m mkt cap Probably make 5m pbt this year .Just need to cap Dcb losses and this will look uber cheap.What a shame as this would have been 60p without this hiccup.Core bus is firing on all cylinders.

[patsc100] 11/7/2022 18:27

@aldriglikvid how do you get to the fact that this is not above 10m? I dont see anything that would confirm that the payment will be lower.

[kinwah] 11/7/2022 09:57

An update that has no new information apart from the use of external consultants to assess the cost of completing the projects subject to PCGs. My view is that they are working towards an RNS announcement of the total costs to complete, a plan of action, an estimate of the financial damage and an equity fundraising to plug the hole in the balance sheet. I wish them well!

[kemche] 11/7/2022 08:23

Oh but I do believe it IS a brainer.

[aldriglikvid] 11/7/2022 07:29

Great update today. Clearly the losses are limited and not the +10m speculated in these threads. Stock is going higher! ev/ebida 2,5x and growing double digits. No brainer.

[dave4545] 11/7/2022 07:16

I think this bear market is throwing up bargains everywhere.

Some companies are doing a lot better than their share price and valuations are suggesting.

[qs99] 11/7/2022 07:06

Decent update all things considering IMO!

Makes the £9m market cap looks silly but DYOR....

[sooty snipes] 08/7/2022 14:32

In my opinion the only thing Kinovo are guilty of is selling a business to people or persons who clearly were not in a position to run the business profitably on a stand alone basis. Do you believe Kinovo should have funded these people indefinitely? If you do then all their birthdays would have come at once. One question What happened to the 3.7 million? I believe that there has been some shenanigans gone on here. Hopefully I believe Kinovo will be vindicated. All will be revealed.

[bagsandbags] 07/7/2022 17:13

@aim215 - all those are good thoughts. Something has obv gone very badly wrong here and some heads should roll.
But i agree with dyor2 and have been picking up stock recently. Management cannot make any statements to the market unless there is bad news, which under AIM rules must be issued immediately and is normally event-driven, or good news, which in reality is normally the outcome of a successful negotiation and therefore needs signatures. My bet is that the absence of RNS recently is a sign that the bad news is already out there and that there is no Board expectation (at the moment anyway) of bigger hits coming. I'm also assuming that negotiations are ongoing, but without an AIM reporting mechanism for saying "things are looking better" without actual agreement being reached, we are going to remain in the dark for some time yet. but my guess is that the reporting asymmetry is actually our friend here. Let's see!

[aim2105] 07/7/2022 16:02

I have been invested in this from the Bilby days and recently sold out at a big loss and cannot feel comfortable with this whole situation.

The silence from Kinovo at present is concerning. I would have expected an update or even an indication upon when they plan to publish their final results?

I suspect the fly in the ointment may be the unknown liabilities they have under the PCG's?

Any new contractor going into an existing project will not be cheap and will include potentially high costs to carry out condition surveys etc?! This could be very damaging for Kinovo, not just financially but reputationally across the social housing industry.

During this saga I have been doing some digging on the whole situation and this really does not look great for the board of Kinovo, for the following reasons-

This is my personal opinion based upon information that is available in the public domain.

Did Kinovo try to offload DCB to hide massive losses and poor management practices?

If so, their RNS in Jan 22 outlining the sale is misleading. Why were we not told of the working cash agreement, failing contracts and potential PCG risks?

The company that agreed to take DCB off Kinovo's hands have only been trading for a matter of months, has one director (Paul Eghan) who on the face of it has zero experience within the building/construction arena and could not financially support a £20m turnover business. This leads me to think "others were in play here".

The new Managing Director of DCB is someone called Valentine Pierre? Who is this? What is his background? What involvement has he had?

Interestingly as per honest workers post it seems that a Chek Whyte was heavily involved in this saga, a simple google of this person shows a very dubious past, multiple bankruptcies, appeared on the TV programme The secret millionaire before going to the wall for £30m. Who was the administrator for this? It seems the same one dealing with DCB?!

The Manchester News article I found from Google on Chek Whyte (dated 16th July 2009) mentions that a Richard Saville acting as administrator has been contacted by Chek Whyte following the £30m collapse of his empire.

Looking at the RNS on 16th May by Kinovo states that CFS restructuring have been appointed as administrators, funnily enough if you look at the webpage of these people the same name crops up- Richard Saville.

Maybe a coincidence?

Now moving back to MCG Global, I see their registered address was changed to 130 Shaftesbury Avenue, which seems to be a firm of chartered accountants, that's it for now, my head is spinning with this, lots more out there on google.

Honest Worker, you seem to have worked within the new DCB outfit, can you assist with the above? Who was running the company and what involvement have they had?

The rise in the shareprice in my opinion is nothing more than speculative buying, any new investors should carry out some due diligence before getting sucked in here, too many unknowns for anybody to make an informed decision.

DYOR

[1divad] 07/7/2022 15:59

Would be nice to know where the 3.7m has gone

[darryn1] 07/7/2022 15:23

MCG Global is a start up without much capital, which is why they needed Kinovo to maintain their working capital in the existing business until ongoing contracts were completed. Even if Kinovo is the wronged party it would not be worth suing MCG because there is no money to fund compensation or legal costs. This deal will probably cost Kinovo at least £5m to clear up the DCB contracts and maybe even more.

[dyor2] 07/7/2022 13:58

The absence of a further RNS suggests that negotiations about the DCB parental guarantee liabilities are still ongoing, which isn’t surprising given the complexity of the situation and the number of moving parts which need to be nailed down. I suspect that many of the major shareholders are now “inside” and being consulted on this, and can’t deal. I’m not “inside” and am happy to wait. But the almost doubling in the share price from the lows suggests that, in the end, the DCB liabilities will turn out to be painful but manageable and maybe people are starting to get a sniff of that. We’ll see, but the recent strong trading statement from Mears bolsters my view that Kino’s core maintenance business is worth a multiple of the current £10m Kino market cap. So IF (it’s still an “if”!) the DCB liabilities turn out to be manageable and can be funded then the shares could still have a lot of upside. Incidentally, I’m not worried about an MCG law suit because I have the impression that Kinovo are very much the wronged party here. Of course, they were extraordinarily naive to enter into the DCB deal in the first place (to put it mildly!)….but nevertheless I suspect they have a strong case against MCG. And as far as I’m aware, MCG haven’t yet followed through on their threat to sue. Maybe not too surprising, because if they were to sue and lose they’d be liable for Kino’s costs. I could be wrong on all this, but for now I’m happy to have picked up more shares near the lows. The Administrators’; report to DCB creditors is due any day now, and that may shed further light on the situation. Kino is of course the largest DCB creditor, due to the £3.7m it loaned DCB post sale.

[qs99] 07/7/2022 10:45

Continuing to rise.....is this looking more hopeful? DYOR

[greg the grinch] 30/6/2022 13:04

There are unknowns.... I am happy to wait.

Any legal process would take years.... by then KINO will have extra cash to pay up.

Of course I don't know, but I reckon KINO will have covered their butt.

GLA

[ddt sprite] 30/6/2022 12:42

I also would like to point out that there was no mention of providing "working capital" when the sale was announced which clearly mislead of detail of the sale to the market.
The whole situation is self induced and absolutely stinks. Investors deserve better from their board.

[ddt sprite] 30/6/2022 12:34

Greg the grinch, i have no doubt that the contract will be a professional and water tight contract. The writing of the contract is not really in question. Kinovo appear to have refused to honour the agreed line of credit to MCG Global which we can only assume was written into the contract and there are grave concerns over the legitimacy of the financial information that was provided to MCG Global about the true financial situation of DCB Kent at the time its sale. Both of these factors are serious allegations which if there is even a hint of truth to, will cost Kinovo greatly. I cannot think of a situation where a recently purchased company has failed and the first actions of the purchaser is to sue the seller unless there is a basis of a case.
Like all investors in Kinovo, I too want the value to rise and for this all to go away but without answers, this remains a very very risky prospect.

[greg the grinch] 30/6/2022 12:09

IMHO, unless the contract was written by a drunk secretary or similar I don't think there should be a problem.

The contract would have been written by a solicitor, and if it left KINO wide-open to getting shafted, then KINO can simply sue the solicitors. Having said that, solicitors love money and don't like to be sued, so I don't reckon they wrote a poor contract.

The contract must have been fit for purpose, because it is too obvious that you are wide open to getting shafted if you just give a blind guarantee - e.g. everyone could give themselves a £1 million per month wage - is that working capital?

Hopefully a steady rise back to 30p+

GLA

[ddt sprite] 30/6/2022 10:45

QS99 yes interesting. Unfortunately none of the questions which saw the share price crash have been answered yet. Until this happens, this is still a very risky company to invest in.

Q1. What is happening with the PCGs. What is the current liabilities on this? and do we trust the figures that Kinovo may eventually share, bearing in mind their recent history on transparency.
Are Kinovo in control of these projects and will they be able to limit the liabilities or have the clients terminated the contracts with DCB under the insolvency clause and subsequently appointed others to complete (much more costly for Kinovo).
Also if Kinovo are taking on the projects, how can they do this bearing in mind they do not have a construction specific subsidiary anymore. They, as a PLC, did not understand construction which probably explains the health of DCB at the time of its sale so what makes them think they can finish these projects now?

Q2. What is the legal advice on the case being brought by MCG Global. We can only at this point assume that there is a case against Kinovo which rating between the lines is either a breach of contract or misleading or fraudulant information at time of sale.

Q3. Will this same board still be at the helm moving forward or will the major investors insist on a new management team.

Too many unknowns to make this investment anything other than a pure gamble.

[qs99] 30/6/2022 08:33

Continuing moves North...interesting times...

[mrjakeydunhams] 21/6/2022 16:24

Big pump incoming, dump all ya money in (Not financial advice, I’m not a financial advisor)

[qs99] 20/6/2022 12:14

Dead cat bounce or a few getting in ahead of any new news? Thoughts? DYOR