Thursday, January 13, 2005

ERHC Exec Ali Memon In Africa, Delaying Response to DJNS

The reason ERHC has not responded to phone calls regarding a story in preparation by DJNS reporter Norval Scott is that the company's new Chief Executive Officer, Ali Memon, is in Africa and communications with him are problematic, according to a source with with first-hand knowledge of the issue.

Memon, who was hired after bids for the choice blocks in the Nigeria-Sao Tome Joint Development Zone failed in the first round of licensing, is a former Marathon Oil executive with wuide experience in Africa. While he is in Africa, DJNS reporter Norval Scott is in London, and the two have had difficulty matching schedules and phone calls, the source indicated.

The source said that in fact ERHC does want to talk to Dow Jones, which publishes the Wall Street Journal and maintains the Dow Jones News Service, the wire service for which Scott works.

The story is expected to be a positive one, and the company's silence has raised question about ERHC's failure to respond. The issue's share price has been depressed for months, and it has long been under attack by short sellers who have now reduced their naked short positions, resulting in the stock's removal from the Threshhold Securities list last night.

There has been speculation that the company itself may have an interest in keeping the share price down due to a possible merger or buyout that would come after awards.

Such a possibility was first raised by the Los Angeles Times in May 2003.

The company's controlling stockholder, Sir Emeka Offor of Nigeria, no longer maintains ownership of a majority of the company's 629 million outstanding shares after settling a lawsuit on Nov. 10 with Nigeria's First Atlantic Bank by transferring 60 million shares to the plaintiff. Since then, according to the well-regarded Menas Consultants monthly newsletter, Offor has "taken a back seat" at the company, allowing Memon to take the lead.

Update 1035am EST: Reader markvo10 caught a mistake in an earlier version of this story. There is no difference in time zones between London and Abuja; the phrase "time zones" should have been "schedules." We regret the error.


Anonymous said...

Thanks Joe for that story which some may view as seemingly unimportant.

tradertrades said...

The title implies that Ali Memon is actively avoiding the DUTY to respond and DJNS has the RIGHT to have response. I think that's misleading.

...Joe Shea said...

As a journalist, i can only thing of unfortunate reasons when someone doesn't want a story out on their penny stock. ERHC certainly has the right not to respond, and some have even said that - including Norval Scott in a recent note to me, posted below. It is never taken as a positive sign, however. Good news moves a stock, and I don't think Norval is gunning for ERHC. I think ERHC is simply not a very good communicator. I imagine Ali Memon is busy around the clock in Africa, too, meeting with Dr. Daukoru, Emeka IOffor, other players, the JDA officials, etc., and is not sure what he wants to say. He may also be gaming the story so that it comes out at the best possible time for ERHC, as most companies would.

Anonymous said...

Rancho says: Joe is correct. Either ERHC has some very bad news that it wants to avoid or they are "gaming" the story to allow it to be released at the best possible time. I would guess number 2. I am sure that Memon is busy...but there is no way that he cannot parcel out a block of time to talk with Norval over the span of a week IF he so desired. Do we forget the flurry of activity when markvol posted that Norval wanted to talk to investors about a story?!?! People were hastily posting and emailing to get this to happen. ERHC investors were in a hurry, but ERHC the company has no such haste. They will wait...