TSK - TASK Group Holdings

[Bilbo]

Thanks for the recap BFG. I have been sitting on the fence on this one for a long time after having been bitten by Snakk (fortunately managed to exit without too much damage), but decided to take a small wager ($3,000) in Dec at 1.1c. Part of the reason for doing so was that having a stake would force me to pay closer attention to the company by regularly evaluating the hold/sell/buy more decision. I am obviously happy with the 63% paper return to date

The one big question I have in response to your concerns is why has Snakk Trustees not sold any shares since listing (their last ssh notice was Dec 13, but companies office is still showing the same number of shares as at listing). After listing the sp rocketed to 8c before falling and then rising back to around 5c giving plenty of opportunity for that quick profit. Maybe the shareholders know this one is worth riding for the long term?

Also, what do you make of Tim Cook and Collins Asset Management taking a stake in the latest capital raising. From what I can tell Tim Cook is savvy and well respected.

[bunter]

Thanks BFG, very useful and interesting.
FYI Brett Wilkinson was a financial journalist in the mid eighties, before deciding he wanted a piece of the action.

Would be interesting to see the actual contract vmob holds with McDonald's. It doesn't seem to be making much money for vmob.

The one shining light is Phil Norman, who to his credit, can call himself the inaugural chairman of Xero, so far a huge success story in NZ. It is also worth noting though that he is now Sean Joyce’s business partner at CM Partners Ltd, which is a corporate advisory for small companies looking for capital

Could be he saw how easy it is to make huge money on the back of little more than a good story and decided to team up with the experts.

Xero could make it, and I hope it does, but IMO it is way overpriced and will more likely end up with a market capitalisation similar to the other companies you mention.
Best hope is to be bought out before it's too late.

[BFG]

The one big question I have in response to your concerns is why has Snakk Trustees not sold any shares since listing (their last ssh notice was Dec 13, but companies office is still showing the same number of shares as at listing). After listing the sp rocketed to 8c before falling and then rising back to around 5c giving plenty of opportunity for that quick profit. Maybe the shareholders know this one is worth riding for the long term?

I honestly do not know Mr Sorenson's mindset and why he hasn't sold down. Who knows, maybe he does believe this is the next big thing (sorry buddy ). But the fact that he used a sneaky entity called "Snakk Trustee" to hide himself and his Snakk holding before selling every share he had speaks volumes about his character!

Also, what do you make of Tim Cook and Collins Asset Management taking a stake in the latest capital raising. From what I can tell Tim Cook is savvy and well respected.

I agree. I can't say anything bad really! Good people do get caught up in bad plans though...

[whatsup]

I have written this piece up (with the help of another member) that will helpfully inform those considering an investment in VMob so they are fully informed as to its history, as well as the blue sky potential that some are suggesting awaits the company due to its recent announcements. (Baa Baa, please read carefully!)

VMob started its life off as a horse racing breeder company called Strathmore Group Limited in the late 1980s. However, Strathmore succumbed to whatever ills it caught in the late 1980s and early 1990s, and the listed entity went through a number of reverse takeovers. Between the 1990s and now, it was known under a few names, including Velo Capital, Media Technology Group Limited (of which Phil Norman was a director), and eventually VMob Group as of mid 2012.

There have been a number of colourful people involved in VMob that shareholders should be aware of before considering investing in VMob:

- The main investor/banker is John Sorensen via Snakk Trustee Limited, who of course has been an investors in Plus SMS, Truscreen, Snakk Media, Baboom and Mega Ltd (through his vehicle VIG Limited). He has been involved in a number of companies dating all the way back to Rainbow Corporation in the 1980s. His speciality is buying up very cheap assets, getting them listed, and then exiting at big profits while new investors pick up the risk.

- Other investors include Laddara Pty Ltd (of Australia). These are the Higgins brothers, who own a large painting and contracting firm in Melbourne. They were large investors in the mangled wreckage of Plus SMS Ltd, as well as Snakk Media, Orion Minerals Group and Mega Limited.

- Sean Joyce, director of Vmob, Orion Minerals, Truscreen as well as Plus SMS and more. Joyce’s business used to be called Corporate Counsel, but is now called CM Partners. He specialises in listing penny dreadfuls, and has acted for Sorensen interests many times in the past. Listings and reverse takeovers he has been involved includes names like Seadragon, Snakk Media, Eastern HiFi, Dominion Finance, NZ Finance, Jasons Travel, National Mail, RIS, Feverpitch, ICP Bio and Zintel.

- Brett Wilkinson, who was also part of the Plus SMS wreckage, was involved in Orion Minerals plus other companies listed by Joyce, and is now advising investors at Vulcan Capital.

- The one shining light is Phil Norman, who to his credit, can call himself the inaugural chairman of Xero, so far a huge success story in NZ. It is also worth noting though that he is now Sean Joyce’s business partner at CM Partners Ltd, which is a corporate advisory for small companies looking for capital.

So what of these companies?

Plus SMS has to be one of the worst-ever companies to grace the NZX since the 1987 share market crash wiped out the worst of the 1980s. In short, they made misleading statements to allegedly allow insiders to pump and dump the stock. But rather than re-litigate their entire history here, you can read it all at the following links:
http://www.nbr.co.nz/article/plus-sm...un-deep-103750
http://www.nbr.co.nz/article/history...listing-121166
http://www.stuff.co.nz/sunday-star-t...Plus-SMS-story
http://www.nzherald.co.nz/business/n...ectid=10753959

Truscreen is a newly listed company selling a product which had chewed through several tens of millions of Australian dollars before failing a few years back. The wreckage was picked up by John Sorensen for peanuts value, dusted off, and then backended into Truscreen late last year. A company whose assets were perhaps valued at less than $20,000 is now in a company worth $18m. This has been covered in quite some detail on teh TRU thread, but Chalkie makes an excellent case for why extreme caution needs to be exercised:
http://www.stuff.co.nz/business/opin...e-share-appeal

Orion Minerals - this mining company doesn’t do any mining anymore. It appears Mr Jacomb was persuaded to put up capital by his good (ex-)friend Ken Wikeley in order to finance a ground-breaking new drill piece and procedure that was going to make them millions. Turns out it was pretty much a scam and the entire thing went to court for years. It owns some scrap metals businesses in Melbourne. It doesn’t appear to have made a profit at any point, and Mr Sorenson was also involved quite heavily:
http://www.stuff.co.nz/business/opin...verse-listings

The repeated inclusion of these individuals and others in numerous penny dreadfuls with appalling track records of shareholder wealth destruction and bad governance suggests that more of the same is at least a possibility at the other companies they are involved in.

This is why it is important to heavily discount any news coming from VMob about successful contracts, particularly given the Plus SMS background which mimics VMob in several ways.

The same people who promoted and benefitted from the Plus SMS debacle are the same people who are promoting and benefitting from "global contracts” in Vmob. (Note well: the Vmob contract announcement the other day comes without any revenue figures, or any meaningful way to assess the real price sensitivity of the announcement.)

The same people who have promoted uncapitalised small companies with slim prospect by “blue sky potential", are the same who then sell down at highly inflated levels .

The same people who oversaw capital raises for some of the worst NZ corporate wreckages are the same people who are raising capital in Vmob (subject now to concerns being consider by the FMA - without anyone having filed a complaint to date, no less!).

Maybe Vmob will hit it out of the park. Maybe they will be well capitalised. Maybe they have superior management and the governance will surprise us with their vision and prudence. Maybe Vmob will be a great success.

But for this great success, investors will need to weigh up the histories of Plus SMS, Orion Minerals, Snakk, Truscreen, and a whole host of other poor and awful entities, and work out whether they as the Johnny-come-lately-investors are the means by which others profit from.

The risky vs reward scenario here is very clear here if you buy: YOU take the risk and THEY take the reward. As Balance likes to say; Heads they win, Tails you lose.\

Be careful out there people...

In my opinion some people would sell their fathers if they knew who he was !!

[Harvey Specter]

The question is can this company make the transition from being a baddoor dog to a company that stands on its own merits. The old dogs are still hanging on to the share register but the company is making some wins so maybe they see a future success (otherwise why weren't they selling down when it hit 5c? or were they?).

Time will tell but the contracts sound promising. they just need to turn them into Revenue with a good GP margin.

[Monty]

Time will tell but the contracts sound promising. they just need to turn them into Revenue with a good GP margin.

I have followed VMoB since I bought some shares in late 2013. Since then there have been a series of positive announcements. and nothing negative. in fact I would say each announcement is better than the last. (although the next announcement is very unlikely to exceed the Global McDonalds announcement.)

There does seem to be so much negativity here about VMob. I am wondering what is the reason behind the hostility. Oh well if it keeps the share price down then that will be my advantage while I accumulate a few more shares.

[bunter]

(although the next announcement is very unlikely to exceed the Global McDonalds announcement.)

There does seem to be so much negativity here about VMob. I am wondering what is the reason behind the hostility

I Wonder why the Company hasn't told the shareholders how much Money the Global McDonalds' announcement is Worth.
Presumably they Know.

[klid]

I reckon they do but Maccas told them to keep shut about it.

[Monty]

I Wonder why the Company hasn't told the shareholders how much Money the Global McDonalds' announcement is Worth.
Presumably they Know.

I would hazard a guess that there are commercially sensitive reasons. I am relatively new to the sharemarket and trying to spread investments over a number of portfolios - but very few organisations actually disclose how much particular contracts are worth. However based on publically available information there is some considerable upside. if for instance VMob can charge between $25 and $50 per month for each site then that is between $4.2m and $8.4m from one revenue stream for the McDonalds in the USA alone (based on 14,000 outlets. add in set up fees, on going maintenance costs and revenue from use of vouchers and sales and the revenue looks pretty good. Add in McDonalds Asia and Europe and things really start to look up. I suggest you go look at the investor information on the website. and put 2 and 2 together

[bunter]

I would hazard a guess that there are commercially sensitive reasons.

Me too, but maybe not in the way you meant.