Originally Posted by
TBM-Legend
Rumour on the legal street is that the Board and Scurrah are being lined up over the November bond raising for misleading and deceptive conduct over the financial representations they made to investors. The real situation of the accounts was not properly disclosed. Watch this space...
That's surprising. The prospectus for that notes issue was pretty straight up and down. 20 pages of it were dedicated to outlining risks.
What I would like to see is the business case and Board minutes for the acquisition and debt raising. Even with optimistic growth of Velocity the deal had at best a 5 year payback period, likely longer. Most importantly, the debt tanked net equity into the red. Debts exceeded assets by over $100 million and that didn't include the AASB 16 treatment of leases. By trashing the business's net equity it removed any resilience to shocks that the business had. EB is the chair at IAG; if she doesn't understand business risk I don't know who on that Board would.