News blog
CustomVis
- BY: Andrew Hore |
- POSTED: 02/07/2009 |
Rebel shareholders in CustomVis claim that they have the backing of 40% of the company’s shares in their attempt to vote two existing directors off the board and replace them with their three nominees.
The rebels, led by former CustomVis managing director Simon Gordon, want to remove chief executive Paul van Saarloos and Simon Carroll from the board of the laser eye surgery equipment developer. They would like to replace them with Gordon, Hugh Grant and Christopher Bell.
Gordon was managing director of CustomVis during a period when the share price slumped by around four-fifths - between July 2003 and November 2004. He makes a lot of the rest of his experience in the sector.
He was an investor in Autonomous and he worked on sales and marketing for the business between 1996 and 1999. Autonomous, whose chief executive was Randy Frey, was acquired for around $86.6m in cash and shares by Summit at the beginning of 1999. Summit Autonomous, whose chief executive was Robert Palmisano, was taken over by Alcon Laboratories for $894m in the middle of 2000. The bid came after Summit received CE Mark approval for Autonomous’ LADARVision system, which enabled it to market the system throughout the European Economic Area.
Gordon was working for Q-Vis between September 1999 and May 2000 - just prior to its ASX-listing. Q-Vis went into administration at the end of 2002. Gordon also worked at Lasersight, which got into financial difficulties and was dumped off of Nasdaq because it did not fulfil certain listing requirements.
Gordon was not a board director at any of these three companies. If nothing else, his previous employment shows how difficult it is for this type of business to prosper.
Gordon is confident that his work in gaining positive reports and comments from respected specialists helped to add value to Autonomous. This is the strategy that CustomVis said it was going to follow in its flotation prospectus in July 2003. It is also the strategy that is proposed for CustomVis if the rebels take control. This will require additional cash to be raised because it will take some time. Gordon believes he can raise that cash.
CustomVis has limited cash resources and it has to carefully manage its working capital. It recently sold a laser system in France and a sale to Iraq will be recognised in the figures for the year to June 2009 - taking the full year revenues to £1.7m.
At 1.78p a share, CustomVis is valued at £3.01m. Any fundraising is likely to be highly dilutive to existing shareholders.
Gordon and van Saarloos both worked at Q-Vis and both came to terms with its administrator after suing for unfair dismissal. The two men subsequently had the right to acquire the Q-Vis technology and they agreed to give CustomVis an option over that technology.
The rebels do not have any firm evidence that they will be backed by shareholders owning 40% of the shares. This is based on what the shareholders have told them. If these shareholders do back them in the vote then the rebels will undoubtedly be in a strong position. The board has claimed the backing of around 30% of the share capital.
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