Golden Tower / Lateral

[Hectorplains]

Backdoor listing of a residential property developer / building materials retailer announced today. It's unclear to me if they are to adopt the Golden Tower moniker (gawd, why would you?) or remain as Lateral?

[winner69]

Backdoor listing of a residential property developer / building materials retailer announced today. It's unclear to me if they are to adopt the Golden Tower moniker (gawd, why would you?) or remain as Lateral?

Wouldn't be Lateral as they going 'private'

You be into this hector?

I don't think investing in a co developing properties and selling (cheap) imported Chinese building materials is my game.

[Hectorplains]

Wouldn't be Lateral as they going 'private'

You be into this hector?

I don't think investing in a co developing properties and selling (cheap) imported Chinese building materials is my game.

Well, what could possibly go wrong here? A backdoor listing of a company with an unknown board... is Golden Tower even currently operational or just an idea? Another vote of confidence for the quality of the NZAX...

[winner69]

Well, what could possibly go wrong here? A backdoor listing of a company with an unknown board... is Golden Tower even currently operational or just an idea? Another vote of confidence for the quality of the NZAX...

Have $1.6m of property to put in

Can't be bothered working it out but I presume minority Lateral shareholders haven't / wont be winning out of this.

[Hectorplains]

Have $1.6m of property to put in

Can't be bothered working it out but I presume Lateral shareholders haven't / wont be winning out of this.

They pretty use to not winning. Laterals main 'revenue' seems to be from getting its loans written off.

[SilverBack]

I wrote this dog off some time ago but the Golden Tower reverse takeover raises some questions.
The announcement, reiterated as a "binding" agreement (as though shareholder votes do not count) says that the Lateral business will continue as a private company. There is no indication of who the owners of that company will be but obviously the LAt shareholders are excluded or it wlould not be private. Nor is there any indication of the transfer of intellectual property and other assests (e.g. Viaduct platform software, customers etc) to the new private company will be achieved. This is a very smelly arrangement without any transparency.
The announcement says "all of LAT's assets being transferred into LAT's wholly owned subsidiary, Lateral Profiles Limited. The shares of Lateral Profiles will then be distributed pro rata to all of LAT's existing shareholders."
If all the assets are transferred then that includes IP, software, goodwill etc etc. So what mechanism then results in a new private company to contin eu the business activities of the existing LAteral? At present they are owned absolutely by the LAT shareholders.
Come clean Roger Grice, Dene Biddlecombe, Robert McAuley and any other parties to be involved in the private company!


With the Golden Tower transaction valued at $3.2M/463,405,050 (shares)/90%, we get a value of $395,062 for LAT these days. However, the announcement avoids saying what deal has been arranged between Golden Tower and the prospective owners of the new private company, or any value thereof.
Furthermore, where is the independent valuation for this deal that shareholders would normally expect?

[Felonius]

"Smelly indeed" Silverback.
Tasman Capital launched Lateral onto the market a couple of years ago so i suspect Keith Jackson and Joseph van Wijk are also involved.

[Snow Leopard]

There is Lateral Corporation, which is listed on the NZAX - Hereafter referred to as company A.

There is Lateral Profiles, which is not listed anywhere - Hereafter referred to as company B.

And there is Golden Tower, which is also not listed anywhere - Hereafter referred to as company C.

At the moment you own a small part (hereafter referred to as p) of company A which owns all of company B and therefore you own p of company B.

Company A is going to give you your p of B and get out of the way. As B is not listed on an exchange you will have more trouble buying and selling shares in them than you do now.

So then you will own p of A, which now owns nothing, and also own p of B.

Next A will buy C by multiplying the number of shares by 10 and giving the new ones to the owners of C.

So then you will own one tenth of a p (hereafter referred to a deci-p or d) of A which owns all of C ...

... and you still also own an entire p of B.

So in summary p . A (~B) --> d . A (~C) + p . B.

That should clarify it nicely

Best Wishes
Paper Tiger

[dodgy]

There is Lateral Corporation, which is listed on the NZAX - Hereafter referred to as company A.

There is Lateral Profiles, which is not listed anywhere - Hereafter referred to as company B.

And there is Golden Tower, which is also not listed anywhere - Hereafter referred to as company C.

At the moment you own a small part (hereafter referred to as p) of company A which owns all of company B and therefore you own p of company B.

Company A is going to give you your p of B and get out of the way. As B is not listed on an exchange you will have more trouble buying and selling shares in them than you do now.

So then you will own p of A, which now owns nothing, and also own p of B.

Next A will buy C by multiplying the number of shares by 10 and giving the new ones to the owners of C.

So then you will own one tenth of a p (hereafter referred to a deci-p or d) of A which owns all of C ...

... and you still also own an entire p of B.

So in summary p . A (~B) --> d . A (~C) + p . B.

That should clarify it nicely

Best Wishes
Paper Tiger

Very clever Tiger !!!

[SilverBack]

Joseph van Wijk is a Director of Lateral Corporation but he will not be associated with the new private company going forward (according to the announcement).
None of the other comments on my post above, address in anyway the concerns that I raised (except that Felonius agrees it is "smelly" -i.e stinks of self interest and non-disclosure without regard to minority shareholders. The issue is, what is the deal for the new private company to carry on with the existing LAT's business activity? Paper Tiger has correctly understood that LAT shareholders will own 100% of Lateral Profiles (according to the announcement) but fails to identify how the intellectual property (IP), software, goodwill, etc will be transferred from Lateral Profiles/Golden Tower to the new private company so that it can continue the existing LAT activity (which is clearly stated as the intention according to the announcement).

BTW, Paper Tiger, Golden Tower is registered. It is registered as a NZ company with the NZ Companies Office and was set up in May 2016. That is how you can determine who is the sole shareholder and who is the sole director (and who happen to be different people). The company is using LAT as a vehicle to obtain an NZX listing using the mechanism that is commonly referred to as a reverse takeover. Once the transactions take place and the new ownership structure is in place then we can expect a name change to occur, not that it actually makes any difference unless the new private company is retaining the Lateral name as part of the deal, in which case there needs to be a consideration as to the value of that name for trading purposes.
So, where is the independent report on valuations and reasonableness of the transactions that we normally expect in transactions of this nature? Where is the independent directors' statement at the very least? Are there any independent directors? I thought that was a requirement of the NZX and so it would have to be van Wijk because the other two directors are Biddlecombe and McAuley, who most definitely are not independent.

[Snow Leopard]

...but fails to identify how the intellectual property (IP), software, goodwill, etc will be transferred from Lateral Profiles/Golden Tower to the new private company...

A owns B and a business (hereafter called the biz). A can simply give all of the the biz to B. A still owns B and still owns the biz but now via B.

It does not have to any more complicated than that, so accept that fact and move on.


Moving on...


...BTW, Paper Tiger, Golden Tower is registered. It is registered as a NZ company with the NZ Companies Office and was set up in May 2016...

Never said it was not. I said it is not listed (as in on a recognised exchange). Different thing entirely.

If you are going to fret over this you will end up SilverBackAndFront.

Best Wishes
Paper Tiger

[SilverBack]

Well, PT, you have still only stated the obvious from the announcement without giving any information. There has to be an arrangement for any new private company to continue the business of the existing Lateral Corporation and this has neither been qualified nor quantified. What of an independent recommendation for the takeover? Are you an interested party in the new private company?

[Snow Leopard]

Well, PT, you have still only stated the obvious from the announcement without giving any information. There has to be an arrangement for any new private company to continue the business of the existing Lateral Corporation and this has neither been qualified nor quantified. What of an independent recommendation for the takeover? Are you an interested party in the new private company?

What I now realise, from your response quoted above and a ten minute look at the company, the accounts and the recent announcements, is that you should already be aware of the answers to your questions and the fact that you are not means it is a complete waste of time to continue this conversation.

Best Wishes
Paper Tiger

[SilverBack]

What I now realise, from your response quoted above and a ten minute look at the company, the accounts and the recent announcements, is that you should already be aware of the answers to your questions and the fact that you are not means it is a complete waste of time to continue this conversation.

Best Wishes
Paper Tiger

Hi Bright Eyes,
Personally, I think that you are up yourself. You cannot even conduct a rational discussion and give answers to serious questions.

[SilverBack]

Hi Bright Eyes,
Personally, I think that you are up yourself. You cannot even conduct a rational discussion and give answers to serious questions.
On second thoughts, perhaps you are an interested party to the LAT/Golden Tower/new private company arrangement. After all, you have not denied it. If you feel attacked by my questions then your response is understandable on the basis that the best form of defence is attack.