ASX Changes Listing Rules, Intermedia Claims They Had No JV With Suspended Video Company
The Australian Securities Exchange (ASX) has moved to change its listing rules following an investigation into Big Un, a video Company who repeatedly in what now appears to be false claims told shareholders that a core partner of their operation was a joint venture with Appliance Retailer Publisher Intermedia.
It also appears that Intermedia has become an innocent victim as evidence emerges that Big Un executives have made false claims about a JV relationship with the Company.
Despite repeated statements in Big Un annual reports, investor briefings, press releases to media organisations and a video on YouTube indicating that a JV was done between Big Un, Intermedia, solicitors acting for the media Company have said that Intermedia never proceeded with any joint venture with Big Un Limited.
Solicitors acting for the Company claim that ‘Shortly after the plans were announced and before any steps were taken, the agreement was abandoned’.
The Companies representatives, have refused to say whether the media Company advised the ASX or later the Australian Securities and Investments Commission that the JV had been abandoned.
The ASX have told ChannelNews that Intermedia were not “legally” obliged to advise them that they did proceed with a joint venture with Big Un.
Currently Big Un is being investigated by a joint task force of ASX and ASIC investigators after the Company was suspended from listing on the ASX.
In a compliance update dispatched late last week, the ASX firmed up its guidelines to stamp out the over-exaggeration of gains from customer contracts and also announced immediate changes to rules governing the disclosure of information about Company directors as well as information supplied in annual reports.
The exchange said it would crack down on companies that announce contracts with major global customers that lack details; that don’t mention the contract is conditional or subject to a trial period; that include loosely derived revenue projections; that aren’t updated if the contract is terminated; or are presented as material or with other “superlatives” when they are not.
Big Un who did acquire Intermedia assets, claimed prior to listing that they had entered into a joint venture with Intermedia.
They repeated these claims in both Chairman and Director statements.
The ASX said “Whenever the ASX detects this sort of behaviour it will not hesitate to suspend the entity, query it and require it to correct any inadequate or misleading disclosures,” the update said.
The ASX said it could also refer any entity to the Australian Securities and Investments Commission for consideration of further action.
The ASX also announced a change in policies effective immediately that requires all directors or proposed directors in back-door listings (where a new company uses the shell of an existing company to list on the ASX) to provide evidence of their good fame and character.
The Australian Financial Review revealed earlier this month that Big Un chief executive Richard Evertz, who had previously run a failed ASX listed company under a different name, was reportedly charged with blackmail in 1994.
In a statement to the exchange made earlier this month, Big Un said “all necessary criminal and background checks were undertaken for members of its board and senior management,” as required by the listing rules.
The company said Mr Evertz “does not have a criminal record” and all relevant disclosures were made to the market.
The tightening of regulations by the ASX includes existing directors who have been elected by shareholders to the board. Previously for back door listings, the ASX only required “good fame and character” checks for new directors being appointed to the board.
ASX has also highlighted its power for both front door and back door listings to require “good fame and character” checks from those involved in management of a company where ASX suspects that the reason they are not joining the board is to avoid those checks for directors.
Big Un found its way onto the exchange via reverse listing in 2014 has been suspended for over a month as regulators make further inquiries.
Despite indications that Big Un had access to Intermedia databases and that the Company was working closely with the publisher of Appliance Retailer the Company has told ChannelNews that Intermedia has never supplied Big Un Limited with its subscriber details.
“Intermedia has never “supplied to Evertz and his management team [any database] for the purposes of soliciting video engagement”, solicitors acting for the Company said.
Intermedia did confirm that in 2017, Big Un Limited purchased all the shares in three subsidiaries of Intermedia, Food and Beverage Media Pty Ltd, BHA Media Pty Ltd and A List Guide Pty Ltd.
They also claimed that Intermedia provided management services to those companies, however they refused to identify what services were supplied.
They also claimed that Big Un Limited does not own or have any financial stake in Intermedia and that neither Intermedia nor its directors, was aware of any prior convictions.