The bizarre two-month rise of Fifth Element Resources from an unknown explorer into a $330 million company on the back of no news whatsoever has prompted the Australian Stock Exchange to exercise rarely used powers and suspend the stock from trading.
The company has received six price queries between June 5 and July 14 — believed to be a record for a single company in such a short period of time — and Fifth Element company secretary Nick Geddes has said in each response that the company had no explanation for its price changes.
One executive of another junior exploration company said the events at Fifth Element were an embarrassment to the sector. “This to me makes us a laughing stock,” the executive said. “Why would people buy stock at $8 when they’re doing nothing?
The ASX said it had suspended Fifth Element while it reviewed whether the company in fact complied with all conditions when it listed on the exchange in late May. Since raising $3. 5m at 20c a share, Fifth Element has surged on very thin trading volumes to as high as $8. 03 a share on Monday.
Three holders — Diamond Peak Overseas Limited (48 per cent), HSBC Nominees (35 per cent) and Pershing Nominees (12. 1 per cent) — between them control 95 per cent of Fifth Element’s stock.
Read more here: Business Spectator