ShadowFall is short Network International ($NETW). Report available to download from: shadowfall.com/researchservic…
Some of the Wirecard connections to NETW’s intended acquisition, DPO, are already known. However, we have found numerous links…. 1/7
Some of the Wirecard connections to NETW’s intended acquisition, DPO, are already known. However, we have found numerous links…. 1/7
Yes, DPO bought Acona from Dietmar Knöchelmann, who was subsequently convicted for money laundering & fraud. However, we also find that DPO has been audited by a former co-director to Knöchelmann. 2/7
As for DPO’s initial company secretary & Director, these are the same individuals connected to Greymountain Management, which is currently involved in an ongoing US CFTC court case regarding binary option scams. 3/7
We view several DPO related metrics provided by NETW’s management as contradictory, whilst we struggle to make sense of the guidance. When considering DPO is a roll-up - acquiring businesses for 1x-2.5x sales – the price to NETW of 12x Pro-forma sales appears eye-watering. 4/7
But that’s just DPO. What about NETW? We believe the major pre-IPO shareholder, also NETW’s major customer, could have been incentivised to boost NETW’s numbers ahead of IPO. Now this shareholder has a fraction of its former holding, this incentive is significantly reduced. 5/7
We’re unconvinced losses for “discontinued operations” all relate to these businesses. NETW’s info on disposals does not appear to reconcile with local filings or the buyer’s version of events. The buyer was Finablr, so admittedly it’s difficult to know who to believe! 6/7
We believe our report and NETW’s disclosures raises a number of questions which NETW’s shareholders may welcome some clarity on. These questions can be read in our open letter, which we have addressed to NETW: bit.ly/3mFkyfr 7/7
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