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Re: SOO - Solco Limited

Summary Announcement. Solco. Suspension pending recapitalisation
Date of Report: 07-Aug-2006

Solco Ltd (ASX: SOO): The directors of Solco Ltd (“the Company”) request a suspension from trading while they undertake a process to recapitalise the Company.
The directors advise that the Company has not been able to close the placement announced on 13th July 2006 because the market has traded below the placement price of AU $0.18.
The Company is undertaking a further financial review of its business in light of the recently reported financial performance for the June quarter.
The Company has also commenced negotiations with parties to recapitalise the Company subject to the appropriate approvals. The Company considers that it is prudent to suspend trading in its securities pending an announcement as to the outcome of such financial review and recapitalisation negotiations.
 
Re: SOO - Solco Limited

StockExplorer said:
Summary Announcement. Solco. Suspension pending recapitalisation
Date of Report: 07-Aug-2006

Solco Ltd (ASX: SOO): The directors of Solco Ltd (“the Company”) request a suspension from trading while they undertake a process to recapitalise the Company.
The directors advise that the Company has not been able to close the placement announced on 13th July 2006 because the market has traded below the placement price of AU $0.18.
The Company is undertaking a further financial review of its business in light of the recently reported financial performance for the June quarter.
The Company has also commenced negotiations with parties to recapitalise the Company subject to the appropriate approvals. The Company considers that it is prudent to suspend trading in its securities pending an announcement as to the outcome of such financial review and recapitalisation negotiations.
Click to expand...

Recaps are very good for companies that are bullish about their prospects or wish to unlock capital value.
Solco are confident, even though their placement at 18 cents basically failed.
In this weaker position share holders are unlikely to benefit: http://www.altassets.net/knowledgebank/learningcurve/2006/nz9006.php
 
Re: SOO - Solco Limited

Summary Announcement. Solco. Resignation of CEO

Date of Report: 15-Aug-2006

Solco Ltd (ASX: SOO): The Chief Executive Officer of Solco Dermot Patterson has resigned from Solco effective from 25thAugust 2006 to take up senior executive position in the health services industry where he has over 30years of international experience.

The directors acknowledged the important role that Mr. Patterson has played since joining Solco in early April in addressing operational and cost problems in the business.

The Company suspended trading in its securities on 7th August 2006 pending an announcement as to the outcome of a financial review and recapitalisation negotiations.
 
Re: SOO - Solco Limited

Summary Announcement. Solco. Solco sign Agreement to Re-capitalise Company

Date of Report: 24-Aug-2006

Solco sign Agreement to Re-capitalise Company

On 22nd August 2006 the Company entered into a conditional Heads of Agreement with interests associated with non executive director, Mr. David Richardson to re-capitalise the Solco Group. Under the arrangement:

* Mr Richardson’s interests will procure for Solco to be provided up to $1.5 million in loan funds (on a secured basis) for immediate working capital requirements to alleviate Solco’s current financial pressures.

* The Company will be seeking shareholder approval to raise $1.5 million in equity by placing approximately 62 million shares or 43.5% of the diluted capital of Solco with interests associated with Mr. Richardson with the proceeds being applied to retire the $1.5 million loan in (i) above and otherwise for working capital purposes.

* Mr. Richardson will become the Managing Director of Solco effective from 28th August 2006 until 30 June 2007, with Mr Richardson’s remuneration to be reinvested in Solco equity representing a further 3.5% of the diluted capital base of Solco. Mr. Richardson has over thirty years of high level business experience. Most recently, Mr. Richardson was a senior executive with a large publicly listed engineering company.

* A shareholder rights issue by Solco is contemplated in the first half of 2007 to further recapitalise the Company for future growth business ventures. The present intention of Mr Richardson and his interests is to support such a rights issue to maintain their percentage holding in Solco. They have also undertaken to use their influence to seek to procure third party underwriting support for such capital raising.

The Heads of Agreement and associated transactions are conditional upon all requisite regulatory (ASIC and ASX) and shareholder approvals as well as completion of satisfactory due diligence by the Richardson interests on the Solco Group. The proposed timetable for the transactions is as follows:

- signing of formal documents (by 28 August 2006);

- issue of notice of shareholder meeting (by end of September 2006;

- shareholders’ meeting (by end of October 2006); and

- completion (by early November).
 
Re: SOO - Solco Limited

http://www.asx.com.au/asxpdf/20061002/pdf/3ysd3q7nz76fv.pdf


After glancing through the " Annual Financial Report " above, there appears to be a very dark cloud hanging over SOO. It becomes obvious why the CEO has departed and losses of nearly six million dollars looks, sadly, to be dire for shareholders.

The only hope is that some form of recapitalisation will be achieved, leaving shareholders with some interest in the company.

The Directors seem to have forgotten the number one important factor in managing a company, " THEY ARE THERE TO MAKE PROFITS ".

Good luck to everyone and especially Stockexplorer and friends in Germany who have an interest.
 
Re: SOO - Solco Limited

I have sadly seen this happen before and been in exactly the same position as shareholders of SOO. It is very difficult to just accept the investment error, not invest in a rights issue, and just walk away. The rights issue will be deeply discounted and draw in present investors who hope to get their money back.

Always hope your investment will come right in the end, even though it probably will not, and don't pour more good money after bad.

The new Directors will takeover and the old Directors will leave over time. The new board will have to pour a great deal of money into making this venture financially credible, and will end up owning over 50% of Solco. The name of the company may be changed, followed by a share consolidation.
 
Re: SOO - Solco Limited

Shareholders in Europe (almost 100 shareholders with a total of approx. 4.7 million shares) intend to issue an open letter to Management and Board of SOLCO Ltd.
We request all SOLCO shareholders to participate and add questions, comments and suggestions to the text down below. Thank you for your co-operation.
For confidential messages email: StockExplorer@web.de


“On behalf of a number of European shareholders (see attached listing for details) we would like to express our gravest concerns about the recent recapitalisation plans as well as the lack of adherence to due process in terms of keeping shareholders informed about events that lead to the current financial crisis.

As a starting point we would like to note that SOLCO Ltd initially advertised its activities using words such as "ethical" and "sustainable", "service" and "results", which instilled trust and made shareholders believe, that SOLCO Ltd was worthwhile investing. Shareholders are concerned that, given the recent events, SOLCO Ltd is not fulfilling its promises implicitly contained in its company value statements as proclaimed on the web-site nor living up to its obligations towards shareholders.

In particular, the shareholders would point to the following shortcomings in terms of shareholder communication and commitment:

· SOLCO's share price was subject to a very substantial devaluation, experiencing a fall by more than 50 per cent since March 2006 with expectations of further share price erosion when trading will resume in mid-November this year;
· shareholders were not notified of significant and grave financial problems caused by warranty claims in the hot-water-solar branch and consequently were prevented from and unable to act appropriately;
· following investments in excess of AUS$3,5 million undertaken by the management for restructing purposes in 2006, no results have been made public nor have shareholders been informed about progress on such restructuring;
· shareholders are aware that the global SMS-licenses business is experiencing difficulties, however shareholders have not been officially notified by the SOLCO management;

In relation to the present recapitalisation proposal, shareholders are concerned that these restructuring activities will mainly benefit Mr. David Richardson and will exert enormous pressure onto shareholders.
· Firstly, shareholders will be subject to a very significant dilution in terms of share value and consequential loss of their invested money;
· if shareholder approval will be given, Mr. Richardson will own 47 % of SOLCO Ltd.(including his wages); and
· if shareholder approval is not given, Mr. Richardson will claim AUS$1,5 million from the company.
The above begs the question, what will become of SOLCO Ltd and shareholders are concerned that the future of SOLCO is at best dim and entirely uncertain in terms of reassurance of their investments."
 
Re: SOO - Solco Limited

StockExplorer said:
SOLCO LTD important announcements:

Notice of Extraordinary General Meeting
Annual Report 2005/2006

http://www.asx.com.au/asx/research/...chBy=asxCode&allinfo=on&asxCode=SOO#headlines

any comments ?!
Click to expand...

Hi Stockexplorer et al, I have read the " Notice of Extraordinary General Meeting " and it does seem very strange that SOLCO fell from grace quite so quickly. Mr Richardson's interests had been selling shares during 2006 at high prices.

They say the asset value is 3.3 cents and they expect the company to trade at around that price, - don't forget to read paragraph 8.6 on page 34 - though Mr Richardson and his interests pick up shares at 2.475 cents and 2.75 cents, and they do not have to convert options until July 2007.

The " Genius Hot Water System " is expected to make further losses and requires upgrading. Solco have set aside $354,025 as warranty provision and they think this will have to be raised.

Unless the new Directors do something drastic the asset value will fall further. How they have worked out the asset value is a bit of a mystery, so it could be conservative - worse case scenario - at 3.3 cents. Analysts and the press may make further comments and you may be able to see a better picture in a months time, on the other hand you may not.

SOLCO are interesting to watch from hereon in and MAY prove to be cheap at 2.5 cents. Our Mr Richardson may well be a crafty old buzzard, that is, he is picking up stock at below asset value and the 3.3 cents could well be hiked in better circumstances.

The above is ONLY in " My Humble Opinion " and I have no interest in Solco Limited. The above is NOT a recommendation to buy, sell or hold SOLCO stock.
 
Re: SOO - Solco Limited

received following from Australia:

...I attended the Solco EGM / AGM. All resolutions were passed, the company
should re-list in one - two weeks.

Here are some dot points I made from the presentation, which obviously was
all about addressing the issues the company has:
- reducing the cost base - since June 30, they have reduced the cost base by
$1.6 million.
- have addressed all major technical issues and management processes
(mentioned all management systems had broken down, which is true).
- most contractual issues with suppliers and dealers have been addressed
- Warranty issues: They had been receiving up to 30 calls per day, but many
were repeat calls, and a lot of them were plumbing issues only
- The Goal is profitability second half of 2007.
- They are removing low margin products, and / or improving the
manufacturability of products.
- They expect to be back in production of the Hot Water Systems by December.
- Have streamlined the assembly of the Sun Mill and are looking at other
products to complement it but have also lost the distribution of Lorenyz
pumps because of an issue with the Australian Lorentz distributor (which I
know in detail, and is a smart move).
- Choice continue to go well and are profitable.
- They have a grant for developing a polymer solar hot water "split system",
but wouldn’t give a timetable on when it will be ready as it needs to be
100% right
- They have a new business unit - Sustainable Global Business Solutions,
which is a consultancy business assisting new technology companies to
commercialise their products (and which can leverage off the existing Solco
distribution)
- The SMS business looks like selling again.
- The rights issue planned for next year is not for working capital, it is
for Future business.

All in all, my feeling is that there is more hard work to do, but the people
in there are the right ones to do it. Can it be done? Only time will tell....
 
Re: SOO - Solco Limited

StockExplorer said:
SOLCO share trading will resume on Monday 18.12.2006
(see latest ASX info) !
Click to expand...

Good Luck, hope everything works out well for holders of Solco Ltd., and you get your money back in due course.
 
Re: SOO - Solco Limited

Solco have opened at a surprisingly high 9 cents a share this morning. NOT saying anyone should buy the stock at this price but may be worth watching over the next few months.
 
Re: SOO - Solco Limited

Moving down and trading at 7.8 cents as of posting. I expected them to open around 3.5 cents yesterday and they would be interesting at that level.
 
Re: SOO - Solco Limited

Solco shares continue their downward path at 6.5 cents today, surely, they will not achieve my guessed for 3.5 cents. A very worrying stock are SOO and this share price performance recently adds another question.
 
Re: SOO - Solco Limited

yeah, this is embarassing. And with such a bright future for solar too. This company appears to be the dogs bollocks.
 
Re: SOO - Solco Limited

This stock has hit my radar and I think you guys are missing the point by looking to much backwards.
The severe and necessary restructure of this company has occured, they are no longer loosing money, and the new MD is busy solving some of the warranty issues they had.
Solco has some great core products in a fast growing field by the time of the next AGM the balance sheet will be positive and 8cents a share will seem like a gift.
I for one am buying this one and looking foward to some excelent returns.
This may prove wrong but I can see mostly upside.
:)
 
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