EGM4 Boon Wins, Price Falls & suX Staggers

Posted   March 29, 2012                          Twitter: @PaperlinXsuX
Updated March 30, 2012

This is a quick update on events and share price action since Andrew Price narrowly lost at the EGM last Friday.

1. Harry Boon won the vote but little else.
    
2. Andrew Price is well but the other price is sick.
    
3. SuX is again under attack for defamation.
    
4. Toby Marchant is mistakenly angry with suX.
    
5. A Good News edition will be published over the weekend

Harry Boon won the vote but little else.

Somehow I get the impression the PaperlinX camp doesn’t have that “winning feeling”. The press coverage in Australia has been far from flattering post EGM, particularly the comments by Orbis. See here. 


Then this popped up in the Irish Times. Defalcations happen and I’m saying nothing, other than the mixed messages sent by penalties. A person in a position of responsibility steals €140,000 over 30 months in what appears to be a fairly crude manner. He has no prior convictions and is a good family man; however he’s apparently addicted to alcohol and gambling. Three years in the slammer will cure everything. The same would happen in Australia.


If the same man with the same mitigating factors robbed a bank (no guns involved) or defrauded a pensioner, the penalty would be significantly higher. Just goes to show that penalties for white collar crime are more lenient than for blue collar crime.


Andrew Price is well but the other price is sick.


Andrew Price and his charming wife Mary, it is she who sends the daily PaperlinX Press, are off on holidays for a couple of weeks over Easter. However, they are not going away. 


Regular readers will be familiar with suX’s strongly held views about share ownership and share prices. For any newcomers:

“People talk, but money shouts” 

“Watch what people do, not what they say”

“When in doubt, follow the money”

See here  posted immediately following the EGM where I predicted a share price fall. 


Updated March 30, 2012
Dare I suggest that Mr Market agrees with suX. See CHART 3a updated to Friday, March 30, or six trading days since the Boon win. PaperlinX (PPX) closed at 8.0¢ today, Friday. This now gives a whopping 33.3% loss since the EGM.


Significantly, 8.0¢ is lower than the intra-day of a low of 8.8¢ during the highly volatile two hour 14 million share volume bloodbath last Friday. 


Now we seem to have slow solid decline by disillusioned bulls, with share price falls in five of six trading sessions. The only "up" day was Monday March 26 when Director Lyndsey Cattermole accounted for 42.7% of that day's volume, see Appendix 3Y here.


Up by the stairwell, down via the elevator shaft.
The price rise from 6.5¢ to 12.0¢ was sustained over seven weeks. The fall from 12.0¢ to 8.0¢ has been like a hot knife through butter.


Where to from 8.0¢
This is an important "round number" price. It has been the subject of support/resistance in the past. 


Expect some stabilisation at 8.0¢, however there is "thin air" between 8.0¢ and 6.5¢. Notice how rapidly the fall from 8.0¢ to 6.5¢ occurred in January and the rise from 6.5¢ to 8.4¢ occurred when Andrew Price declared his hand. 


In the absence of new money giving new confidence external to PaperlinX restructuring announcements, I expect prices below 8.0¢. 


Eventually, opportunists will buy but don't expect them to be in a rush until more disillusioned bulls are shaken out. It's nearly time for a major Boon supporter to start selling to Andrew Price like happened in January.


End Update


SuX is again under attack for defamation.


It appears the folk at PaperlinX didn’t like PaperlinX agrees with suX 99% of times. They weren’t meant too. Clearly it was written in response to the unsavoury atmosphere at the EGM. Games of imputation can get out of hand. 


Regrettably a couple of pages will be going for a short break pending resolution of the Concerns Notice received today, Thursday. 


The relevant pages are here and here.


I treat this seriously, however there is always the funny flip side to nearly every situation. Without divulging the Notice, you can imagine what it says. 


Here are just three examples of humour arising from the Notice:


Humour #1 Everyone knows that PaperlinX follows suX carefully. This has been demonstrated many times. Somehow PaperlinX didn’t think to object to any posting between November 29, 2011 and March 28, 2012 – just on 100 posts. Suddenly, suX is defamatory. Go figure. 


Humour #2 As part of any defamation claim there are the usual “loss” and “damage” statements. Please check out share price CHART 3, being the prices of PPX since suX commenced on Nov 15, 2011 and today, Thursday March 29, 2012. 


Using ASX guidelines, there are probably five price sensitive events in that time.


15 Nov 2011 – suX commences (I flatter myself)
23 Dec 2011 – Platinum Equity “proposal” announced 
03 Feb 2012 – Andrew Price arrives
22 Feb 2012 – Interim Results of PaperlinX
23 Mar 2012 – Boon defeats Price at midday


By sheer coincidence, the day I received the Notice the share price closed at 8.6¢ which is the exact price on Nov 15, 2012. I guess that demolishes one argument.


Since Nov 15, 2011, PPX has never closed above 9.0¢, except when the market thought Andrew Price would win when the price was range bound between 10.5 -12.0¢.


According, because suX supported Andrew Price during which time the share price rose 85% we will legitimately claim that in fact we assisted PaperlinX, not potentially damaged it. 

I’m sure the lawyers will have a counter argument which I’ll be prohibited from sharing with you.


Humour #3 Since Boon won the share price has dropped 28%. Hey! Who causes real damage at PaperlinX?


Toby Marchant is mistakenly angry with suX. 


Probably he’s just angry with Australia generally this week after reading what Orbis said, see here. 


Earlier this week I sent what I considered to be a generally conciliatory note to selected persons. It was marked private and confidential. I also included two journalists who follow PaperlinX closely. Journalists more than anyone understand what private and confidential means. I wanted the journalists to understand my conciliatory position.


I clearly stated two things: 1) There are no blind copies of this email, and 2) In accordance with my strict policy of moderating blog comments it (being the subject matter) won't be published. Not until it is verified or collaborated.


I didn’t expect a response as I rarely receive responses from PaperlinX these days. In fact there was probably no need to respond. 


Clearly Toby Marchant thought differently. He sent me a mega-blast copying all original recipients, including the two journalists. Unfortunately he left it as an open letter – i.e. not private and confidential. 


At this stage I don’t intend publishing the Marchant response, I have the Concerns Notice to deal with at present; however he gave licence to the journalists.


This is what was reported in Melbourne’s The Age and Sydney Morning Herald today, see here. Good one Toby. Hey! Who causes real damage at PaperlinX?

It’s easy to blame the messenger.

EGM3 PaperlinX agrees with suX 99% of times

It’s official – PaperlinX agrees the facts with suX on 99% of all postings.

During his presentation at the EGM, or perhaps when answering a question, Harry Boon referred to a “defamatory blog”. 


He also mentioned a “defamatory blog” in the Financial Review full page feature published on Wednesday, March 21, just before the EGM, see here and in The Australian published on Saturday March 24, see here.  


The latter referred to the three hour EGM as “distinctly personal” - an understatement. What follows is one example.


By the way, how did Harry Boon get a full page feature article in the Financial Review just two days before the EGM – see here?


I’m presently compiling a full report on the proceedings of the EGM to be published soon.


Let’s be clear, this blog has a mission spelled out in ABOUT US. It’s our second most visited page after  Whistle-blowers HERE. Does that tell you something about the success of our mission? 


To the best of my knowledge and ability I publish hard facts and personal opinions on this blog. Regular readers know I’ve made this offer consistently - If ever you think I’ve defamed you, tell me in writing and I’ll retract. 


I assume that if PaperlinX doesn’t seek a retraction or correction then it must agree with the facts presented, because I know that every word published here is scrutinised.  


I never expect Harry Boon to agree with my opinions; however we now know that 48.16% of voters at the EGM agree with me and not him. Very comforting.

Holding differences of opinion is democratic, not defamatory.

Exchange between Boon and Critchley at EGM


At the EGM I asked Boon to withdraw his defamatory comment that suX is defamatory. Along the way, in an exchange with Boon, I stupidly said words to the effect that because he or PaperlinX had never sought a retraction, it must all be true. 


Mistake. In the heat of the moment I forgot a minor exchange between suX and PaperlinX back in November, 2011. 


Readers should be aware that in Australia barristers cannot be held liable for mistakes made while on their feet in court. At the EGM I paid dearly for this mistake.


Here is the timeline of events and documents relating to the one retraction.


Thursday, 24 Nov 
James Orr phoned me to “suggest and request” certain deletions from www.paperlinx-sux.com. 


Thursday, 24 Nov
I immediately wrote to him requesting a written suggestion and request, see here. 


Friday, 25 Nov
PaperlinX served me by way of email a Concerns Notice which I understand is the terminology for notices pertaining to defamatory material. The attached notice was Confidential and not for publication which I have respected. 

Here is the service of Notice and my immediate response. 


Friday, 25 Nov
I withdrew the allegedly offensive page titled $20M Gift posted Nov 21, see here.


Monday, 28 Nov
I wrote to PaperlinX seeking clarification as to how best meet its requirements. I only received an acknowledgement of receipt.  Here are the exchanges of 28 Nov 2011. 


Tuesday, 29 Nov
I again wrote to PaperlinX seeking its advice. See here. I never received a reply.


11 Dec, 2011
The original posting $20M Gift was amended and expanded and posted as Daylight Robbery. 


Bear in mind this was early days for suX, just nine days from launch; before PIGS, before Platinum Equity, before Andrew Price, before the massive interim loss, before Loch Lomond Golf Club etc. 


There hasn’t been one mention by PaperlinX of defamatory material on suX from 25 November 2011 until the EGM on 23 March, 2012 – four months.


Harry wins the point and successfully humiliated me about my truthfulness in front of the EGM. Of course I was so confused I forgot to mention the obvious facts by way of rebuttal:

1. Yes, I agree there was one posting was withdrawn on Nov 25, 2011 at the request of PaperlinX.
    
2. Between the inception of suX and the EGM there have been 101 postings on this blog. Only one has been challenged by PaperlinX.
    
3. Accordingly, I am entitled to rely on the inference that 99% of the time PaperlinX agrees with the postings on suX. 

That is very satisfying. We'll keep it up.

EGM2 – Is anyone listening? Here's a plan UPDATED

Posted March 26, 2012                                                              Twitter: @PaperlinXsuX

Today I submit a five point solution for PaperlinX, but first some essential background.
        

      “I’m not interpreting this as a personal vote against me;
it is a vote against the performance of the company” 

But the three-hour meeting that preceded his comments was distinctly personal, reported James Frost of The Australian, see here. 

Harry, look in the mirror – is that just a flesh wound?

It’s just a flesh wound

Harry Boon's comments post EGM remind me of that famous line from the Holy Grail. Before we get into the serious stuff, relax and watch four funny minutes of classic British comedy, Monty Python and the Holy Grail, a 1975 film starring John Cleese et al. See the video clip here.

Price the Picador 

Over the weekend I was thinking of simple analogies to describe what’s happening at PaperlinX. A bull fight comes to mind – being a ritual with an inevitable ending. 

I’m not in favour of blood sports, but a slow and bloody ritual is in progress at PaperlinX. 

For those unfamiliar with bull fights, a picador is one of a pair of horsemen in a Spanish bullfight that jab the bull with a lance.                                                                                     They perform in the tercio de varas which is the first of the three stages in a Spanish bullfight. 

Picadors pierce the muscle on the back of the bull’s neck to fatigue the bull’s neck muscles and general stamina in preparation for stages two and three.



Of course the bull invariably dies. I wonder if Harry Boon felt any neck pain over the weekend. 

No doubt old bull Boon has been seriously weakened by Picador Price. But there are two picadors in every bull fight. Who is Picador #2?

It’s easy to name obvious suspects; like Orbis, suX, the AUD, poor market conditions, past board decisions etc.

IMO, the obvious Picador #2 lies within. And I’ve said this repeatedly. 

It takes Price the Picador a lot of time and money to weaken old bull Boon, and it’s all over at an EGM, but Toby Marchant is paid handsomely to do the job every day. And he does this job consistently well.

Picador Marchant - Proof #1 

Simon Marais, MD of Orbis which is PaperlinX’s largest shareholder with 18.29%, has come out and now said publicly what informed people have been saying privately for a long time. See here.   

Update March 26, 10 pm This was expanded upon in an excellent article released by LeadingCompany in Melbourne today, Unseating the chair: how and why PaperlinX's Harry Boon held on, see here.

On Jan 30, four days before the Price Battlewagon declared its hand, and as Orbis foreshadowed a meeting with PaperlinX following its interim results, suX said here:

“It appears that Orbis wants Marchant’s head to roll”.

If one examines PaperlinX’s problems, most in the UK and Europe invariably lead back to Marchant or one of his many sycophants. 

I’ve constantly posted about Toby Marchant at:
Marchant's Flawed Plan + Our Response
Marchant's webinar was a farce, no one there!
Marchant's waste is starving everyone
Marchant wrecks Boon's Hopes
PaperlinX reeks of waste, privilege and nepotism

Blind Freddy could see that ousting Boon was really the first step in ousting Marchant. Now it's out in the open.

Picador Marchant - Proof #2

The employees of PaperlinX generally, especially in the UK, have spoken loud and clear. They live and work where PaperlinX holds 50% market share but shows no leadership.


Let’s assume the majority of employees are decent "engaged employees", as an example see here. They're probably not dobbers* by nature, but what other option is there when operational matters are so mismanaged? 

Moderated comments on suX, and unpublished private emails, consistently detail waste, nepotism and general silliness unbecoming any company let alone one in financial peril. 

Consider the readership of suX last published on Jan 23, here and is now updated to noon AEST, March 25 2012.

The regional trends are obvious and while we don’t publish absolute figures, be assured that readership, by any measure, has soared since early January (Platinum Equity) and February (Andrew Price). 


The UK share of readership has grown rapidly along with rapidly growing absolute readership. There is a meaningful absolute level of readership in the UK.


Who are these blog visitors from the UK? Best guess is concerned staff or other industry people watching PaperlinX implode.


Of course it’s my fault for providing a platform for several thousand UK viewers per week who forgo other pleasures to read PaperlinX-suX because here they get the truth about their employer or industry. 


To deny this is like politicians denying the value of opinion polls.

A suggestion for PaperlinX, before the banderillero appears

After the Picador comes the Banderillero

No one says that Andrew Price is perfect. 




He is simply far better credentialed than most to make PaperlinX work; undeniably better than anyone presently engaged by PaperlinX. And he and his supporters have deep pockets to support their convictions..

Instead of reverting to your norm of denial, blame shifting, blah blah … which no one believes, see here for proof, accept that this is a fast moving ritual with a certain ending. 


Consider seizing the mood for change to your advantage.

Lyndsey Cattermole, Tony Clarke and Mike McConnell weren't around when Toby Marchant was appointed CEO. They can easily blame their predecessors for appointing Toby Marchant.


It’s abundantly clear, despite the dissembling at the EGM, that the Directors wanted Price to join the board and avoid an EGM. That is a fact. He refused because of reasons well understood by anyone who needed to know. That too is fact.


The only hard decision is for Harry Boon. Sacrifice Toby Marchant or be sacrificed. Shouldn't be too hard Harry.


It won’t surprise readers, regardless of their interest in PaperlinX, that most investors don’t care about personalities or egos, or Andrew’s purported house in the South of France, or Harry’s career at Ansell a decade ago. 


Everyone knows that if nothing changes then nothing changes, and “no change” is really PaperlinX's plan. That’s why the vote was so close.


It’s about money, not personalities.


Here’s the plan

1. Make an offer to Andrew Price that he cannot refuse. Here I don’t mean money by way of salary, but SMART** incentives and authority.
2. Set him simple unambiguous targets, over a fixed time frame.
3. Endorse the plan with your pockets and immediately stop this demeaning nonsense about non-executive alignment. 
4. Commit 50% of your fees to equity for the duration of his tenure, 25% to shares and 25% to hybrids, to be run like the Ansell scheme which avoids the problems of “blackout” periods.
   
   Without this your words to the farmer’s wife at the EGM are worthless. Harry, you told us you don’t need the money. Neither do Lyndsey Cattermole or Tony Clarke for sure; and I suspect Mike McConnell too.
5. Sack Toby Marchant.

Send me a success fee when Price meets his targets.

PS - The alternative

This blog was written before publication of Monday’s Financial Review, digital edition, at 2 am. Just as I was finalising the messy HTML blog layout, up popped this article – see here. 

In a bull fight, the bull invariably dies.

Scroll down if you have a strong stomache

* Dobber is a derogatory Australian term for somebody who reports people to the authorities for (usually minor or socially acceptable) wrongdoings.


** SMART is an acronym for Specific Measurable Achievable Realistic and Timebound.

EGM2 – Is anyone listening? Here's a plan

Posted March 26, 2012                                                              Twitter: @PaperlinXsuX

Click to go to updated version

EGM1 – Protagonists Talk, Money Shouts

Posted March 24, 2012                                                 Twitter: @PaperlinXsuX


This blog relates to projections for the future of PPX based on Chart Share Price action. Firstly, congratulations to Harry Boon on winning the vote. Regrettably there were mainly losers on the day.



The Losers, in no order of ranking.

1. Andrew Price because he won less that 50% of the votes cast;
2. Harry Boon because he managed only 51.84 per cent of the votes cast with the benefits of incumbency and the “club”;
3. The three major shareholders, Orbis, Schroder and Maple-Brown Abbott for their own individual reasons;
4. The shareholders who didn’t vote, circa 29%, as their votes may have clarified the overhanging uncertainty;
5. Employees of PaperlinX, especially those in the UK;
6. Suspected whistleblowers as Harry Boon and Toby Marchant will surely use their remaining time in office seeking them out then delivering their revenges; and
7. TRUTH, being the first causality of any conflict.

The few winners, and much more, will be discussed in EGM2 to be published soon-ish.


What’s next for the share price of PPX? 


If you’re interested in the future of share prices, the most valuable resource is past share price action measured against perceptions and facts. 


Apart from algorithm trading by slick operators, shares are bought by the greedy and sold by the fearful. For plain vanilla shares like PPX, i.e. those without exchange traded options or retail short selling; the only way for most people to profit is to buy low and sell higher. 


As previously indicated on the blog, I subscribe to the old maxim: “buy the rumour and sell the fact”. 

I bought after Feb 3 and sold as above. This was posted at Hot Copper at midnight Thursday. I believe that 12¢ is overpriced at present, regardless of who won at the EGM.


CHART 1 is of PPX share prices between Feb 3 and March 23, 2012. It is our best immediate guide to the future.


CHART 2 is of PPX share prices over the past 12 months. In this case it confirms the short term view.


In a subsequent blog I’ll address the implications for PXUPA; however at the moment whatever PPX does is relevant to PPX.


Referring to CHART 1, Andrew Price’s intentions were announced after the close on Feb 3. That day PPX closed at 6.5¢, an equal all time low close for PPX. His timing was perfect.


For the next 6 weeks and 4 days, Mr Market believed Andrew Price would prevail. 


On Thursday Mar 22, PPX closed at 12.0¢ on strong daily volume (4.6M) - up 85% in seven weeks. Mr Market likes Andrew Price.


On Friday, the EGM ran for three somewhat fractious hours. PPX was in a trading halt until 2 pm then followed a blood bath of two hours when 14.5M shares were traded. PPX closed at 9.6¢, down 20% on the day, with an intraday low of 8.8¢ (-27%). 


Obviously Mr Market preferred Andrew Price over Harry Boon.


To put Friday’s bloodbath in perspective, on Black Friday, May 13, 2011, PPX fell 21% on volume of 8.3M shares over 6 hours.


The real worry for long suffering investors and Harry Boon, as opposed to day traders, is the share price band at 10.5-12.0¢ (red). 


Referring to CHART 2, it’s going to take a lot of confidence, i.e. money, to break through this solid wall of share price. The technical analysts call this “overhead resistance”. It probably requires new money as old money is now long tired of PaperlinX.


Also, many traditional “moneyed” buyers are precluded from buying PPX as it is no longer a member of any recognised ASX index.


Nothing that current management of PaperlinX says or does will cause PPX to break through this resistance as the words of PaperlinX have proven to be unreliable guides to share prices in the past.


Three events, indicated on CHART 2 support this assertion:

• May 18, 2011 Toby Marchant’s now famous NoNewNews Conference
• Oct 21, 2011 AGM
• Dec 23, 2011 Platinum Equity’s “proposal” released by PaperlinX. Release of this was an irresponsible act as it neglected the interests of hybrid holders.

After the EGM, the share price band 10.5 – 12.0¢ (red) remains intact. Two important periods are marked with purple ellipses. Note their similarities in terms of time and price action between the upper and lower boundaries. 

There is also a price band of lesser significance between 10.0 – 10.5¢ (amber). The price range 7.5 – 10.0¢ has little recent price action and is effectively no-man’s land.


The green or safe buying band must now be 6.5 – 7.5¢. 


Observe the oscillating price action between the green and amber bands since August 2011, marked with grey dashed arrows. We've now had DOWN, UP, DOWN, UP ....guess what's next?


Down movements in share price start with “PaperlinX Talk” as noted on the dates above, hence Protagonists Talk, Money Shouts. 


Where is the share price headed now?


Next stop is 6.5 – 7.5¢. The share price has been there three times before, and in the absence of some new external force should revisit there soon. Why would anyone buy PPX this week?


The PaperlinX board finds itself in a conundrum. It cannot work out how to make money, but believes it is best placed to find the solution.


The board of PaperlinX may be so successful in thwarting those seeking serious change that the next time the share price revisits the green band; formerly interested parties may have lost interest and taken their marbles elsewhere to play.


In the logical absence of natural buyers, i.e. passive equity investors, an informed opportunist is the only possible buyer.


What price would an informed suitor need to pay to gain the chance to turn around PaperlinX? Platinum Equity thought $120M for 100% and sought to circumvent the rights of hybrid holders in the process. In reality, its total offer of $120M was much less than 9¢ per ordinary share. Much less. 


Andrew Price and his associates thought equity of 10-12% acquired at less than 10¢, and a shake up at the top, would work. So did 48% of shareholders who voted at the EGM.


Assuming the non-voters at the EGM continue to go with the flow, about 50% of the shareholders want significant change, not window dressing currently proposed.


Reverting to CHART 2, it is clear that a serious offer at 12¢ would have a strong chance of success. 


12¢ is supported by "rough" fundamentals. By June 30, the NTA will be circa 15¢ maximum. An offer at 80% of NTA for an inveterate mismanaged loss maker is generous. 


If Andrew Price and his associates decide to walk, who will take their place? Someone like them.


Meanwhile PaperlinX continues to preach to an empty cathedral, synagogue, mosque or whatever is your place of worship. Very soon all that will remain is prayer. 


Time will soon prove me right or wrong. This blog is the opinion of the author and doesn't purport to be investment advice. 

Ansellisation in Action

We are one group, one vision
excl Milton Keynes  

Whistle blower prepared to out himself + MORE

Posted March 21, 2012                                             Twitter: @PaperlinXsux

• Whistle blower prepared to out himself
• Harry Boon accepts the truths of suX
• Harry Boon calls in favours at Financial Review
• Proof that Harry Boon cannot count.
• Introducing Ansellisation of PaperlinX
• Ansellisation in Action - here
• UK restructure complete in the UK? Don’t believe it, here is the proof.
• PaperlinX spending a fortune on consultants in UK, does the Board know?
• DeliveryCo tainted with nepotism.

Whistle blower prepared to out himself

In an amazing comment, set in three parts and posted here, a truly irate insider says: 

"If they continue to lie about this I will set the record straight with names dates and sworn statements from senior people who have left PPX and who are well aware of the truth".

“I just hope this gets published before the EGM”

I know who made this comment. The person is real and I believe totally credible, otherwise his comments would have been moderated.

Separately, Harry Boon accepts the truths of suX

As reported in today's Financial Review, Harry Boon reads suX and our caricatures. See here.  

He believes the personal attacks have gone too far. “I have done my best to shelter my family from it by saying don’t read the blogs that are very personal and quite hurtful,” he says.

Harry, glad to see you admit that the truth hurts. We might be starting to open a dialogue. You've made no attempts to rebut anything said on suX because you know it is all true. Despite this you still cover for Toby Marchant. Why?


Try feeling the hurt of people owning hybrids with a face value of $100 trading today at $16. The hurt of people less fortunate than you, or me, reliant on that alleged income. 

The directors abuse the ASX Notices to issue untruths by innuendo. You're up to dirty tricks galore. 

Show some remorse by having a Q&A at the EGM. If you win on Friday, it'll be a torrid AGM this year.

Mitigate your hurt by requesting me, in writing, to withdraw anything that's not factually true. There's a long list of untruths peddled by you and others. I'll gladly withdraw any published error of fact. 

Until then, readers are entitled to accept everything here as your admission of its truth.


How many favours did Harry Boon call in for a whole page feature in today's Financial Review?

Nice to see a balanced media at work - HERE.

Harry Boon’s own proof he cannot count, anything

Below is a true copy of an article in today’s Financial Review, titled:

       “This is not a battle of shares, says Boon”

Link Here. My comments are highlighted.

No Harry – it’s a battle for equity holders to see through a constant flow of misleading and deceptive information from PaperlinX. This one below from you is a classic case.

Wanna-be PaperlinX director Andrew Price has backed up his big talk by putting his money into the stock but Harry Boon says that’s more about taking advantage of a cheap share price [created on my watch with the share price falling 94%] than anything else.


Boon points out that his 21,000 shares in the paper group were purchased when the stock price was between $1.50 and $2. In contrast, Price’s average entry price is around the 6¢ mark. [Let’s not allow facts to get in the way of a good story. PPX has never traded at 6¢ so the average cannot be 6¢. Having trouble with the truth again, or are all those complex multi-currency transactions confusing you?]


“Since when has it been a criteria for a chairman or director to own any more shares than anyone else?” Boon asks.


“What you have here is an individual private investor who thinks it’s a buying opportunity and sunk his money into it.


“You don’t get control holding 1 per cent. You don’t say to the directors ‘I own more than you, therefore [I should run the company].”


[Fact is that Andrew Price controls 10-12%, which you know, so don’t mess with facts. Worse still is that your largest shareholder, with 18.3%, supports him too.]


Boon said his stake in the group, worth $40,000 at the time, cost him nearly a year’s pay after tax and other fees.


He says he has been looking to buy more shares in PaperlinX but has been unable to do so because of the fervent activity at the company. [“Fervent” is convenient gobbledygook for the share price falling 94% on your watch.]


“We have been in share buying blackout mode in the board for some time because there’s been deals in the wind or results announcements and in fact, three of our board members have been asking me for permission to buy shares for quite some time,” he says.


“We have not found an open trading window where there isn’t some significant inside information that would prevent them from buying, including this week.


“I’ve had to say, ‘it’s not the time given the EGM coming up’.” [Why? Is an imminent EGM now defined as a blackout period too? Or do you think you won’t need to own any shares in PaperlinX after Friday?]


“I’ve been looking to top up but I really haven’t had a window to do it.


[This is a grossly misleading and deceptive statement. It is a lie. Since Harry Boon was appointed a director on 5 May 2008 we’ve had 969 trading days on the ASX. He couldn’t find any window, not one, in 969 opportunities. This is patently not true as co-directors Lindsey Cattermole and Tony Clarke found windows.] 


I’ll need to buy a lot to make a difference at this price.”

Comment

Harry Boon must think everyone is stupid. 


Governance at PaperlinX is conveniently ignored by its Chairman and condoned by his Board. Here are the unpleasant facts on the public record. 


This isn't the first time they’ve been published here and won’t be the last.

• Harry Boon is in breach of Board Policy – see 4 Years of Governance Abuse by Harry Boon 
• Michael McConnell is in breach of Board Policy and the Company’s Constitution – see Breach of Constitution by Director Mike McConnell 
• Toby Marchant hasn’t bought a share in over eight years. 

These three directors have demonstrated no confidence in PaperlinX. Why should investors express confidence in them? Watch what people do, not what they say.

Ansellisation - the new strategy

Harry Boon has suddenly thought up a new idea for PaperlinX – Ansellisation. It’s discussed elsewhere in today’s Financial Review, Link Here.

For readers unfamiliar with Australian corporate history Ansell Limited listed on the ASX in 2002. Ansell is a global provider of protection solutions, such as surgical, examination, industrial and household gloves, protective clothing and condoms (condoms comprise about 10% of the business, but it’s what Ansell is famous for).


Maybe his PR people didn’t like the negative tone of the ASX release on Monday, see here.

Not sure how this “eve of EGM” concept fits in with the Strategic Review, which took six months, but that’s a mere detail when a Chairmanship and $275,000 per annum is at stake. Maybe Harry Boon is now an executive Chairman?


I wonder what Toby Marchant thinks of Ansellisation, although to be fair he’s Ansellised a lot of fine paper businesses over the past decade – if you get my drift.

Why Ansell and Ansellisation?

Harry Boon’s claim to fame is 28 years at Ansell. What his CV conveniently omits is that after 26 years he became CEO and MD of Ansell Limited, the listed entity, but “retired” on June 30, 2004, after just 27 months at the helm and at age 56. 


Most unusual behaviour for such an ambitious man. One could say he was a one trick pony. 

Harry Boon wearing an Ansellised smile

Where did Harry Boon go after 28 years @ Ansell? 

It is important to note he hasn't appeared on the boards of any Australian healthcare companies after 28 years with one of the global leaders in healthcare. I find this odd – very odd indeed.


He first pops up as a founding non-executive director at Hastie Group (HST) in December 2004 which has been an abject failure – see here.  YES, the shares have fallen from $40 to 40¢. Harry Boon is still a director, presumably because he feels obliged to see the task through. What task - oblivion? 


Especially note that Harry Boon has no excuses at Hastie Group as he was a founding director.


In May 2005, he secured a plum appointment as Chairman of Tatts Group (TTS) a gaming business holding excellent licences going back 100 years. It hasn’t been a flash performer either – see here. Fancy not being able to make a roaring success of gambling in Australia. 


Then he became Chairman at Gale Pacific (GAP) on 25 August 2005, another miserable investment – see here. Note that Harry Boon resigned in November 2009. 


Has Harry Ansellised all these companies too? Looks like it to me.

Shareholder arriving at the EGM believes she needs to Ansellised too






UK restructure complete? Don’t you believe it.


This hit my inbox last night. It is complete except for two pieces of personal identification X’d out. 


It is one of many such letters I receive; however this writer supplied his full name, other ID, wasn’t abusive and confirmed everything I hear in one succinct email. 


With these attributes, he sounds like he could be a good sales rep!


Now I know why our UK audience is so high. Its concerned PaperlinX employees because there are few investors domiciled in the UK.


Hi Graham,

I've been following Paperlinxsux for the last couple of months. I hope your influence gains success for the PXUPA holders and the fortunes of Paperlinx can be turned round by Andrew Price.

I can confirm what you have probably been told by many other people.


Boys club within senior management in the U.K. May have been re-structured and making some money, but there are still 3 companies with 3 md's, sales directors etc, plus many other umpteen layers of management all making the sales force report back on pointless exercises. 


Morale is rock bottom as all the sales guys do is reporting, rather than focusing on selling. They're stressed out waiting for the axe to fall, when really it is management that need clearing out. Andrew Price should make the UK one of his priorities.

When I worked at XXXXXXX, many of my customers reported of orders placed for multiple items being delivered on 3 separate vehicles, 3/4 empty from 3 different locations. DeliveryCo*** was a fiasco with agency drivers often used who would not have a clue about handling paper. 

All that's really happened in the UK so far is a thinning out of the ground troops when in reality it could be argued they are needed for hunting out new business, unfettered by middle management trying to justify themselves with demands for reporting.

I believe there has been a consultancy business^^^ working at Hornes for the last year or so advising them what they should already know. I bet that's wasted yet more PXUPA money that should have gone to you. 

Anyway enough of my rant! 


XXXXXXX personal close here XXXXXXX.

Important Late Note

I sought confirmation of certain aspects of this letter from a reliable source in the UK. The responses are truly scary for PaperlinX investors. Again, respondent's words are in green italic text, my comment in blue.


^^^ The UK paper merchant contributor is well informed.

Consultants have been crawling over all three businesses over the last eighteen months – particularly Robert Horne Paper. You would have thought that the senior management team at PaperlinX would know what is required to turn a business around – but not these clowns. They are much more comfortable farming it out to consultants for an eye watering fee. 


The brilliant solution they came up with between them? Shut down the sales offices, bin most of the inside and outside sales guys and have a call centre operation in Northampton. Pitiful. Other competitor merchants such as Premier Paper, Elliott Baxter and Denmaur are cleaning up - in a weak market too. 


Those merchants continue to maintain contact with customers through regional sales offices and good regional sales staff. The other huge merchant in the UK, Antalis, has quietly and efficiently restructured but has not made the monumental error of going down the call centre route yet.


Word on the street is that Antalis hold the view that it’s not clever to be the first merchant to go down this road. They will be happy to go second if it is proven to work. They won’t be doing it any time soon!


The really sad thing is that Toby Marchant cannot restructure three companies in the UK, where he's had allegedly 30 years experience. Or didn't the directors realise this in their ASX release on Monday?


*** "I mentioned to you in an earlier email that DeliveryCo is headed up by John Ball. John was Toby’s logistics manager (not sure if that was his job title) at MoDo back then. As I said previously – there is a pattern emerging here!" Nepotism

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