Mystery Chinese investor buys 19pc of embattled Powerhouse
Embattled tech investor Powerhouse Ventures has received a giant investment from a mystery Chinese investor.
A company called United World Group bought 19.17 per cent of the company (ASX:PVL) for $874,350 last week.
The buy-in was made on Thursday.
The CEO Paul Viney resigned the next day.
Chairman Russell Yardley says his colleague’s departure had nothing to do with the Chinese interest.
“He chose to resign… he was very disappointed in the annual results. He had given it his best shot and he decided to resign,” he told Stockhead.
Mr Yardley said Powerhouse’s current situation ranged from “from very interesting to potentially of concern”, elaborating only that buying a 19 per cent stake was a major event.
They have been talking to United World Group for a little over a month.
“They approached us because they want to invest in the commercialisation of science in Australian universities,” he said.
“They see the investment activities of Powerhouse as an incredibly smart strategy and, being blunt, it’s been executed rather poorly.”
United World Group is controlled by a man named Hong Wang.
His company has an office in Zhejiang province in China and a registered offered in Sydney, but that is the extent of the available information about the new investor.
An investor can buy up to 20 per cent of a listed company in Australia before triggering a provision that forces them to make a takeover bid.
Powerhouse has struggled with bad investments, multiple investee founders and executives walking off the job, opposition to perceived forced sales of companies as it sought to offload its interest, an undisclosed bankruptcy that caused the hasty departure of a former managing director, and a lack of cash.
The business listed on the ASX in October 2016 after raising $10 million at $1.07 per share. The stock now trades at about 15c.
A flagship IPO of one of its investees last year, Croplogic (ASX:CLI), was a flop and a new board is trying to resurrect the company with a new strategy.
Stockhead is seeking comment from Powerhouse on whether they sought the investment and who the new shareholder is.