I don't remember who is who on this board, so this is not directed to bullrider specifically.
I read a story today that reminded me of this so called company and AENG might have some competition. Plus, I wonder if Murray (if thats his name, I forget) made friends with the Mullers in Australia.
You can lead a horse to water ...
Anyway, from Bloomberg today ....
Brent
Be Wary of Supposed World-Savers
By Christopher Byron
(Commentary. Christopher Byron is a columnist for Bloomberg News. The opinions expressed are his own.)
Weston, Connecticut, July 12 (Bloomberg) -- The main problem we have out here at Curmudgeonly Arms is the deer, which eat everything. You plant begonias, the deer come and eat them. You plant impatiens, they eat them too. The other day we planted some arborvitae evergreens, and now the deer are going to eat them as well.
My original plan was to deal with this by covering the place with deer poison. I figured a few buckets of Green Giant corn nibblets, Prestone antifreeze, and ground glass would do the trick. But Ms. Curmudgeonly, who always zeroes in on the weaknesses in my plots, asked how I planned to explain away a backyard full of writhing, dying deer, all holding their stomachs and pointing at the house?
So you can imagine my excitement when, in the midst of this deer dilemma, I came across a stock registration statement for an outfit that seemed perfectly equipped to solve the problem for me -- and in a deer-friendly manner. Bearing the bracing name of Save the World Technologies Inc., and hoping through its stock registration filing to get itself listed on Nasdaq's OTC Bulletin Board, the company claimed to possess the ``exclusive right'' to ``grow, market and distribute'' a tree able to grow 35 feet in a year.
So go figure. Since the biggest deer we've ever seen wandering the moors here at C.A. is not much larger than our neighbor's mongrel Rottweiler (which we beat daily with a rake), this means a tree that grows 35 feet per year will be out of any deer's reach in maybe only the first few weeks of its life. Not only that, if you cut the tree down, it grows right back, an inch per day until, a year later, it's 35 feet tall all over again.
All-Purpose Timber
That's what we need here at Curmudgeonly Arms: trees that grow faster than the deer can eat them. So, suitably stimulated, we read further. And know what we found? Turns out that these marvelous trees are strong like the oak, light like the pine, and come equipped with leaves the size of beach towels -- each one of which inhales ``carbon monoxide'' while exhaling oxygen. You can build houses out of these trees, you can make clarinets out of them. I think I'd even vote for one for president; they're certainly faster growing than George W. Bush -- and doubtless no stiffer than Al Gore.
Unfortunately, when we sent Curmudgeonly Arms' ace reporter - - Ms. Tinker ``Bulldog'' Spitz -- around to the company's address listed on the stock registration statement (1285 Ave. of the Americas) to collect some samples, our excitement began to dim. A company gearing up to save the world? In fact, it didn't even look like Save the World Technologies would be able to save Curmudgeonly's deer. Reported Bulldog Spitz upon exiting the premises, ``There're no trees, or seeds or anything else. It's just a mail drop and telephone answering service.''
All-Purpose Address
Yikes. And worse was to follow. For upon delving deeper into the particulars of Save the World Technologies, it turns out that this corporate fountainhead of environmental friendliness is not really rooted in forestry at all. Instead, Save the World's roots are sunk deep into the rich loam from which many a tree grows skyward on Wall Street: good old-fashioned, grade-A baloney.
The first fact worthy of note about this situation is that Save the World Technologies is not the only company operating out of that midtown Manhattan mail-drop on Avenue of the Americas. If you use one of the wonders of the Digital Age -- i.e., a desktop computer connected to the Internet -- to search the corporate filings database of the Securities and Exchange Commission in Washington, you'll come up with a company bearing the nearly identical name of Save the World Air Inc. This company is already traded on the OTC Bulletin Board, under the symbol ZERO, and also gives its office address as 1285 Ave. of the Americas in New York.
Aussie in Charge
Both of these sound-alike outfits are in fact headed by the same fellow -- a Mr. Jeffrey Muller from somewhere in Australia, who these days is clearly one happy camper, or whatever they say Down Under. With Save the World Air having soared almost 12,000 percent in value, from 10 cents in December to $12 last Thursday, on claims of possessing the global manufacturing and marketing rights to an anti-pollution device for gasoline engines, Mr. Muller's worth, on paper at least, would appear to have been something close to $60 million on his hot air stock alone.
Since Thursday, however, Save the World Air has plunged as much as 52 percent to under $6 a share after a Ford Motor Co. spokesman, in a Bloomberg News report, said Save the Air, through its press releases, has been ``totally misleading'' in characterizing Ford's interest in its engine device. Mr. Muller maintains that Ford executives have expressed interest in testing the technology.
Still, Mr. Muller is probably undaunted. Human nature being what it is, we may assume he harbors ambitions to refry the beans by extending his brand from environmental improvement via auto emissions to more or less the same thing via trees.
Family Affair
Unfortunately, when you read the two registration statements -- the one for saving the world with air, and the other for doing the same thing with trees -- one quickly develops a sense of being in a Save the World house of mirrors. Whichever way you turn, you keep encountering the same companies, the same addresses, the same people named Muller (Jeff, a woman named Lynette who is apparently his wife, and his brother Terence), and the same vagaries about the real value of what the companies claim to own.
For starters, Save the World Technologies not only claims to own the worldwide rights to those trees that supposedly grow so fast you think you're watching time-lapse photography, but also claims to own something that sounds rather like the anti-pollution device that the ``Air'' outfit claims to own. It's not clear from the registration statement whether any of these assets have patents.
As for the Air outfit's thingie, a registration statement filed by the company with the SEC last January describes the device as something that ``when fitted to an internal combustion engine reduces the toxicity of exhaust gas emissions.''
The Thingie Rights
From the registration statement, it would appear that Mr. Muller was the owner of this miraculous contraption, the rights to which he sold to the Air company (which he founded) for a stated balance sheet value of $5,000 in December of 1998. And clearly he knew what he was doing. Though the company's total assets currently consist of $873 in the bank and those $5,000 worth of thingie rights, Wall Street, as of last week, was valuing the company at something approaching $200 million, suggesting that Mr. Muller made a pretty good deal.
Mr. Muller's other Save the World company (the one with the word ``technologies'' in the name) not only claims to possess worldwide rights to those grow-before-your-eyes trees, but also to possess certain rights to something it is calling a ``zero pollution air powered engine.'' Jeff is, by the way, the founder and principal shareholder of the ``Tech'' company as well, which shares the same Australian auditor, and the same New York address and telephone number as the Air company.
In the case of the Tech company, however, the rights to the ``zero pollution air powered engine'' weren't obtained from Jeff at all. Instead, they came from his brother, Terence -- from which we may conclude that saving the world, environmentally speaking, apparently runs in the Muller family.
Tree-Related Rights
So, it would appear, does a knack for striking clever deals. We may conclude this from the fact that, when the Tech company was formed in February of 1996, Jeff and Lynette issued themselves 18 million shares of stock, representing 90 percent of the company's total authorized capital. In return they appear to have given to the company, the following October, all the tree-related rights the company now possesses -- at a valuation that, according to the statement's balance sheet, looks to have been less (a lot less) than $16 million ... or no more than 89 cents a share.
My own personal hunch is that a true fair value of the transferred assets would have put them well under $1 million. But that's just a hunch since the registration statement is almost totally devoid of details as to what exactly was transferred and what Mr. Muller's basis was in the assets at the time of transfer.
In any case, watch what happened next.
Follow the Stock
Six months later, in April of 1997, Terry sold 70 percent of his zero pollution air powered engine business to Jeff's company for A$28,000 in cash and 1.25 million shares of stock in the Tech outfit. The registration statement figures these shares were worth $10 each and that the transaction thus had a value of $12.5 million. But that is only because more than a year later, in May of 1998, the company issued 10,000 shares in a private placement at $10 a share to various unidentified investors.
What matters is that, at the time of Terry's sale of his business to the Tech company, the shares he received back represented an equity interest in an outfit that does not appear to have changed one iota from the previous October when the shares were worth, at most, 89 cents each. Such a valuation would have meant, to Terry, a purchase price equal to $1.14 million at the absolute most, for his anti-pollution business.
Yet if we look at the Tech company's balance sheet today, as Jeff angles to get his Tech company approved by the SEC for trading on the OTC Bulletin Board -- that $1.14 million (at the most) zero pollution compressed air business is now being valued at (and I hope you're sitting down) $150 million! The markup now gives the company, as it seeks to become actively traded in the public market, an apparent book value of more than $9 a share when, in reality, the company may have a book value of no more than 90 cents a share at most, and maybe only a few pennies.
Trees Grow in Asia
As for the company's grow-while-you-watch-'em super trees, well, it's hard to figure out what they're all about, too. The registration statement refers to them as ``Kiri Super Trees,'' apparently a genetically altered type of tree species native to China and East Asia, known as Paulownia tomentosa.
The registration statement says the Mullers owned several acres of them somewhere in Australia, and some ``tissue cultures.'' The statement says the property on which the trees are currently growing has been leased for five years by the Mullers to the company, but is devoid of further details. The statement says the company has also leased a ``cloning'' laboratory, factory and workshop, apparently from the Mullers, but provides no details for those transactions either.
Nor does the statement provide any details as to how much it is costing to run the whole shebang. The company has no apparent employees, but according to the statement is being run instead by ``consultants'' and ``engineers.'' What are they costing? No way to know because the statement says the Mullers themselves are currently picking up the tab personally and will someday send the company a bill. Does this sound like a blank check arrangement to you? Does to us.
What Loggers Know
Be that as it may, the whole arrangement may in fact be nothing more than an effort by the Mullers to dump their foray into Australian tree farming onto U.S. investors. Paulownia tomentosa trees grow rapidly even without genetic supercharging, and their properties have been known to the lumber industry for over a century. Yet a mass market for them has yet to develop.
So here's our suggestion to Mr. Jeff Muller for how to simplify his whole message and get his business off the ground ... how to goose his stock into orbit, save the environment, and solve the deer problem out at Curmudgeonly Arms all at once. Just forget about all the complicated stuff involving anti-pollution engine accessories and Jack in the Beanstalk trees, and get to the heart of the matter: Herds of deer are taking over the planet, and the only way to wipe them out is by running them down with vast fleets of spear-tipped, wooden cars -- cars constructed out of Save the World super trees powered by Paulownia tomentosa gasohol.
Work on it Jeff, there's an idea in there somewhere. |
