And it Continues
When I posted last week about the decrease in local ownership of Utah business, I neglected to include a piece of information I had received a couple of days before: TenFold had agreed to a reverse IPO merger. Versata Enterprises, another business software company headquartered in Austin, will buy out the shareholders. TenFold went public in the dot-com boom but has been a penny stock for some time. It overhauled its management in 2005 and has been aggressively marketing since, but as many have suspected, it was merely to attract suitors. A sign of how far TenFold has fallen is that it also had to sign a $300,000 promissory note in favor of Versata and secured by all remaining assets. You can expect TenFold to be folded by Fall.
And this morning I learned that Nexia Holdings, which owns Landis Salons and Black Chandelier stores, is publicly begging for a buyer. Since Nexia is public, its principal carrot is that it can take a private suitor public via reverse merger without an IPO. Nexia has had two reverse splits in the last year, trying to keep its value above that of Zimbabwean currency, but apparently it's over.
I notice that Nexia's CEO is Richard Surber, a major local player in penny stock public shells, whose schemes seem to benefit him a lot more than the companies he "advises." There are a pile of such sharpies operating here in Utah, taking advantage of small business owners who are looking for capital. I can't see how these stores have any business being publicly traded. If anyone tells you that you ought to go public through a reverse merger with a public shell, at the very least get legal help. You probably ought to put a death grip on your wallet and run away.
My big concern is whether I should invest in anti-depressants. If Black Chandelier goes under, my daughters will be in a major funk.