LionGold anxious to hear from SGX

PHOTO: LionGold anxious to hear from SGX

Stung by a share price collapse and shattered investor sentiment, LionGold Corp's top executives now seem to be in the dark about the status of investigations into the trading of their shares.

In his first media interview since the saga erupted, LionGold chief executive Nicholas Ng Thursday said the company has sent a written query to the Singapore Exchange on the investigations.

But SGX has yet to respond.

"We are anxious to know as well about the outcome of the investigations and are just as amazed as anyone (about the wild swings in share price). We have no idea what's happening," Mr Ng told The Straits Times.

Trading in the shares of LionGold, Asiasons Capital and Blumont Group is being scrutinised by the Monetary Authority of Singapore and SGX.

The counters collapsed early last month, wiping out billions of dollars in market value, after reaching dizzying highs earlier. Investors and broking firms are still reeling from huge losses.

Mr Ng addressed perceived links between two US firms - boutique finance house Jett Capital and New York-based hedge fund Platinum Partners Value Arbitrage Fund - and the trio.

Platinum Partners, which manages more than US$1 billion (S$1.24 billion) in assets, has been instrumental in striking several deals, particularly fund-raising exercises, involving all three companies. In many of these key deals, Jett Capital was the introducer. These links have led to the perception that the trio's share price falls may be related.

"It's fair and reasonable for us to say we don't quite care what Jett Capital does with Blumont, Asiasons or any other company. We are only concerned with the deal they brought to us and are definitely sure they (Jett Capital) are independent," he said.

Last week, LionGold unveiled plans to raise S$17 million by placing new shares to three parties - Wintercrest Advisors, a hedge fund owned by Platinum Partners, and two other people.

This plan pales in comparison to an earlier aborted deal for a private placement also partly involving Platinum which would have raised S$202 million.

"Given the choice, we'd have liked to raise more. But we are taking baby steps. We don't want to take bold moves."

Thursday, LionGold said its gold mining unit in Ghana, Owere Mines, has inked a deal to acquire and process gold-bearing waste tailings from Australian- registered B&C Gold.

Mr Ng, formerly boss of DMG & Partners Securities, and investment banker at Rabobank International and Citicorp in Singapore, said the recent drama over the three stocks has dampened investor sentiment even in the wider penny stock market.

LionGold shares, at 17.7 cents, are trading at an enterprise value per ounce (EV/ounce) of gold of US$15, paltry compared with its listed peers, valued at more than US$230 EV/ounce.

Interestingly, Mr Ng said the firm's shareholder base has grown from 3,000 pre-saga to 5,000 or so now.

The firm, which has been on an aggressive shopping spree for gold mines since last March, may now look for partners to gobble up more assets down the road.

But for now, the acquisition binge may be on hold. At the height of the stock crisis, it had to call off the acquisition of a Peruvian gold miner.

"Our fundamentals have not changed. We have real assets in Australia, Africa, South America and Canada. We are waiting for the dust to settle. It's been very frustrating. We also want an explanation. We look forward to the new year," Mr Ng said.

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