I may be reading too much into it, but as I was browsing the Ancapex (www.anacapex.net) site for new company announcements, I noticed the CEO of BDVR proudly announce the following :
“In an effort to streamline operations and increase BDVR profitability BDVR will buy the land portfolio of Bluestone Investment Group. This purchase will include 21738sqm @ a market value of $L651840+. This will instantly boost the value of BDVR land holdings to approximately $L865440. In an effort of fairness to shareholders and in order to keep the financials of the deal under full scrutiny the payments to Blustone will be 3 equal $L90,000 payments, the first of which will not be due until 12-28-2007. This interest free loan will help sustain the reserves of BDVR, all the while proving the worth of the newly purchased land. In effect this purchase will pay for itself and should provide an additional dividend each month even while paying down the loan. For full details on Bluestone Investment Group and current list of properties for sale visit www.bluestoneinvestmentgroup.info. “
Let’s take a look at the figures and facts, shall we? 21,738sqm for L$651,840 – that amounts to L$29.98/m. If that’s market price, I’m Santa Claus. Anyway, let’s read on. Three equal payments of L$90,000 will be made to Bluestone Investment Group, which I think amounts to L$270,000? If those are the only payments to be made, Bluestone Investment Group is selling land about 58% under the market price they quote for the sale. Does that make sense to you? That’s what I figured.
However, if you look a little closer, both Bluestone Investment Group and Blue Diamond Virtual Reit seem to be registered and owned by the same person : Robo Marx. So, while it appears to be a very good move for current and future BDVR investors, basically what is happening is a front pocket to back pocket operation. Don’t complain if suddenly BDVR shareholders are out of L$270,000 (based on the disclosed payments – there could be more, I simply don’t know) and stuck with land which is worth far less than the 651,840 quoted, or the L$270,000 paid.
While the announcement nowhere states that Bluestone Investment Group is the parent company for Blue Diamond Virtual, it is stated in the prospectus. I guess I’m just not a big Robo Marx fan…
