Stock you'll pay to unload

Article from:

Ben Butler

June 19, 2008 12:00am

SCRIP in teetering Gold Coast financier Octaviar is worth so little it would cost you money to sell it.

The former MFS is among this year's additions to a list of frozen stocks produced annually by Sydney outfit Delisted.

With the end of the financial year approaching, Delisted is again offering to buy non-trading stocks from investors seeking to realise a loss for tax purposes.

The process costs sellers $80, because while Delisted pays $1 to buy a parcel of stock, it charges an administration fee of $81.

Octaviar, formerly chaired by one-time prime ministerial hopeful Andrew Peacock, was crushed by a $1.7 billion debt mountain in January. Shares that had traded for more than $4 last year reached a low of 99c on its last day of trade, January 18.

Asked yesterday if the stock was worthless, company secretary David Anderson said: "No comment."

Octaviar is one of 18 companies added to the list this year.

Others include:

Winemaker Evans & Tate, which went into voluntary administration in August last year.

Asian Pacific Ltd, a technology company which has been suspended since February despite a board rejig in May, which brought former St Kilda Football Club president Rod Butterss to the board.

Junior miner View Resources, which went into receivership in early February.

Delisted chief executive Tony McLean said that in the five years the service had been operating, only one company on the list had returned to trade on the market*. (see CORRECTION below) 

"In that particular case our opinion was substantiated by an independent expert who also got it wrong," he said.

This year's list was winnowed down from about 130 suspended, delisted and failed companies.

"There are companies that are not quoted (for one reason or another) where we believe there is residual value and we recommend shareholders do not sell to crystallise a capital loss," he said.

Under tax law a loss can only be crystallised if the shares are sold at arm's length or company administrators make a formal declaration the stock is worthless.

Mr McLean said his service was "not a huge money-making exercise".

"It is run on a shoe string and provides a living of sorts, but only if we live frugally," he said.

CORRECTION

* No we did not say that - we said something to the effect that over the five years we have prepared an annual list, only one company on the list had returned to trade on the market where the shares had more than negligible value.