11.07.2014

Smiths buys into market

Smith Electric Vehicles US, in which Tanfield has a 25 percent stake, has acquired an 85.3 percent holding in Colorado based American Business Services Inc for $340,000.

The company, listed on the OTCBB (Over-The-Counter Bulletin Board) market in the USA, is a consultant in the area of marketing, raising capital and going public.

Headed by chief executive Phil Ray, 76, the company appears almost dormant. Terry Ray resigned earlier this year as secretary and director and in May the company failed to file its latest quarterly 10-K report. The shares were previously listed with zero value.

Vertikal Comment

SEV is one of two ‘ investments’ that Tanfield has left, the other being a minority stake in Snorkel. SEV is desperate to obtain a listing in the USA in order to benefit from a three stage investment by Chinese lithium ion battery manufacturer Sinopoly, which is contingent on SEV obtaining a full listing - see:SEV investment
The $340,000 ‘investment’ will be seen as a consulting fee and back door entry to a flotation, and when one considers the advisory fees that can be charged in this area it is probably an absolute bargain. The Sinopoly investment will significantly dilute Tanfield’s holding and whether the investment will ever pay off remains to be seen.