Evil Diaries: Anything but Clear

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Evil Diaries: Anything but Clear

Last Monday Clear Leisure (LON:CLP) offered the market a resume of various features on its balance sheet. This was styled a “Business Update”. It was fascinating but inconclusive. This seeming vagueness is not caused by the stupidity of the CEO, one Francesco Gardin (FG), since, with the best will in the world, it is very difficult to be certain of anything at CLP at this stage. However, I am an optimist and reckon that at anywhere under 1p CLP is cheap since it capitalises CLP at £7m. I remain of the view that FG is an entirely honest and intelligent fellow: he dissed my overpriced Brunello di Montalcino.

FG knows some chaps behind Eufingest, a financier which has held FG’s hand for some years now. CLP and Eufingest have now agreed that the debt owed to Eufingest, about €3.5m, will be repaid come December 2022 and carry interest at a very modest 1% (this might be the total cost or it might be an annual rate – the update is unclear on this point but, since the distinction is not important, I’ll leave it be. What is interesting is that this debt can be converted to new ordinaries in CLP at 1p per share. Hardly bearish.

As against that Eufingest also holds E3m of the E9.9m Zero Coupon Bond of CLP. The face value of this bond is disclosed currently to be E4.8m. This is not clear. And it is hard to separate this disclosure from that referred to in the second paragraph – a related party transaction, don’t you know. We’ll just have to await further details.

The Update refers to a number of legal claims now being pursued by CLP. This is pure Jarndyce and Jarndyce territory in Italy. But FG seems to be getting through these with a cheerful smile.

The troubles were originated under the stewardship of a Mr Villa (pronounced as in ‘swerve’ and not as in ‘corn-grinder’). Mr Villa has long departed the scene. Thank goodness.

If you want to get romantic you may care to dwell on the claim against Piedmont of the order of E40m. If you incline to be sceptical as to the reasonableness of Italian Courts, I suggest that one entirely discounts this claim. One might otherwise descend into a cynical disposition from which one might never recover.

As readers can readily see the aggregate position is pretty murky. But FG is working on some top wheezes and therefore I think I will take a chance.


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