Seeking Alpha

TSquared's  Instablog

TSquared
Send Message
T Squared is a fundamentally-oriented private investment firm focusing on special situation and deep value companies.
My company:
T Squared Partners LLC
View TSquared's Instablogs on:
  • Mr. Datawni's Resignation From L & L Energy, Inc. Paves Way For Stronger Board

    T Squared Partners, a long-term investor in L & L Energy, Inc., welcomes the recent resignation by Mr. Datawni from its Board of Directors. While we are very impressed by the existing caliber of coal industry expertise currently comprising the Board of Directors of the Company, we believe that the company did not possess a strong member of the board with knowledge and expertise in the entrepreneurial, small capitalization financial markets. Based on our observations over the course of his tenure, Mr. Datwani lacked the necessary business or financial acumen that would be required to advise L & L Energy on financial and public markets matters. Therefore, we believe his role in the company hindered the financial capabilities of L & L Energy.

    Mr. Datawani's resignation, despite being untimely, is a positive event to pave the way for a stronger, more appropriate board member with the needed financial experience. With the strength and exposure that the Board of Directors already possesses in the coal industry, we feel the company should now focus on identifying a board member that can better help guide them through the future successes and challenges that will arise by virtue of being a rapidly growing company.

    While being a public company can provide much long-term value to shareholder, the small cap marketplace nevertheless also contains many parties of negative ilk, from the stock price manipulators to the death spiral financiers, which provide a reputable company challenges to creating such shareholder value. Having this spot open on the board, we believe, should be an opportunity for L & L Energy to bring on a member of the board that can help guide them and lead them through the potential perils that are present in the marketplace. As a long term shareholder, with both coal and financial experience, we would welcome the opportunity to further align our interests and provide more guidance to the company as it navigates through its near and long term opportunities while helping to ensure that the company avoids pitfalls of the past.

    Disclosure: I am long LLEN.

    Tags: LLEN
    Nov 27 9:57 AM | Link | 6 Comments
  • L & L Energy Conclusively Proves Ownership Of Ping Yi

    It is our opinion that the link provided by L & L Energy, Inc. (NASDAQ:LLEN) on their website (currently at http://www.llenergyinc.com/pr/Ping_Yi.html) fully puts an end to Geoinvesting's deliberate attempt to manipulate the share price of LLEN (as can be seen on January 17th, 19th and 20th, just before options expiration), a direct violation of Rule 10b-5 of the Securities Exchange Act of 1934, which reads:

    It shall be unlawful for any person, directly or indirectly, by the use of any means or instrumentality of interstate commerce, or of the mails or of any facility of any national securities exchange,

    a. To employ any device, scheme, or artifice to defraud,

    b. To make any untrue statement of a material fact or to omit to state a material fact necessary in order to make the statements made, in the light of the circumstances under which they were made, not misleading, or

    c. To engage in any act, practice, or course of business which operates or would operate as a fraud or deceit upon any person, in connection with the purchase or sale of any security.

    Over the past couple months, and even more so with LLEN's letters published today, it is clear that Geoinvesting is fabricating false data and making untrue statements of material fact (and purposefully omitting facts) in order to mislead investors and manipulate the share price of LLEN for their own profit. Geoinvesting used the testimony from a coerced individual who had no legal or ownership rights Ping Yi to make the "conclusive" statement that LLEN did not own Ping Yi. This was completely false and manipulative, as per the definition above.

    The apparent nature of their activities can be broadly seen by the short selling activities the day they attempted to manipulate the stock price of LLEN. For example, by going to http://www.shortvolume.com/ and putting "LLEN" in as the ticker and changing the chart date criteria to "3 months" you will see that the stock dropped specifically in the period that Geoinvesting targeted their manipulative efforts (January 17th, 19th and 20th) and attempted to drive the stock price down. During that period approximately 90% of the volume was purely short selling and not the selling of actual shareholders. We believe this makes it clear and apparent that their intent was not only to provide false information to the market to move the market, but also through short selling give the appearance that individuals were selling the stock based on their news, when in reality this was just a ploy to spoke the market and create an unnatural market that enables them to profit.

    We can only hope that the proper authorities take notice and act appropriately to help preserve the integrity of the markets, as it is clear that Geoinvesting has no integrity.

    -----------------------
    Source of Information below: L & L Energy, Inc's website

    www.llenergyinc.com/pr/Ping_Yi.html

    In response to misleading and false allegations questioning L&L's ownership of its Ping Yi Mine, the Company has contacted Ping Yi's previous owners who confirmed L&L's purchase of the Ping Yi Mine. In the attached affirmation letter, the three former owners, Mr. Baoguo Zhang, Mr. Honglin Chen, and Mr. Shauangyou Liu state they were controlling owners and gave Mr. Baoguo Zhang the authority to sign the agreement selling the mine to L&L and confirmed that Mr. Baoguo Zhang received payments from L&L for the purchase of the mine.

    The former owners also signed a declaration stating that Mr. Hu Shiwei, who questioned L&L's ownership on a video, was misled by a third party. His statements were also the subject of a series of statements and videos that included incorrect information. In the declaration, the former owners of the Ping YI mine, who now reaffirm that they sold the Ping Yi Mine to L&L, request that any information stemming from Mr. HuShiwei be removed.

    Disclosure: I am long LLEN.

    Tags: LLEN
    Mar 30 9:56 AM | Link | 3 Comments
  • Pictures Of Ping Yi Operations, Over Extended Period Of Time, Confirming LLEN’S Ownership

    Over the past month, we have witnessed an attempt by Geoinvesting to place uncertainty and doubt in the minds of investors of L&L Energy (NASDAQ:LLEN) through the release of a series of blog posts. The timing of their releases (for example, options expiration, progress dates at LLEN, and other key events that would result in profit if such releases moved the market) clearly showed the intentions and goals of Geoinvesting: to instill fear and uncertainty in the market, thereby enabling them to profit from the manipulation of LLEN's share price. The core goal of their blog posts were to put panic in the mind of investors by causing them to question LLEN's ownership of Ping Yi mine, and make the claim that LLEN never purchased the mine in the first place.

    The crux of their argument has relied primarily on:

    1. Conversations with an anonymous and unverified individual named Mr Wu that were not independently validated and questionable in integrity.
    2. A suspicious testimony of an individual who claims to be a minority owner of Ping Yi, who read from a pre-arranged script and included this person asking what his lines were, while the director of the video whispered to just read the script. Given the nature and appearance of the interview, we fundamentally and fully question Geoinvesting's intentions and the integrity of this individual that was acting out his role (actors typically get "paid money" for their role).

    Missing from Geoinvesting's analysis is the presence of actual "on-the-ground" due diligence, something we would have expected any "research" firm to conduct prior to releasing such an opinionated and "conclusive" report. Given the basic fundamental need of this type of due diligence, the lack of actual on-the-ground due diligence and unbelievable incompleteness of Geoinvesting's work leads us to believe in ulterior motives, but that is not the point of this article.

    The point is that we have actually been on-site at Ping Yi, several times, and for extended periods of time. We have reviewed actual bona fide documents and have proof of actual footage and pictures that show, among other things, the ownership of Ping Yi by LLEN. During our various times at Ping Yi, LLEN management has both been there with us, and we have been there in absence of any senior management. This clearly allows us to verify independently with the personnel at the mine sites, the local government officials, suppliers, and customers - people both introduced to us by LLEN, and those who don't have a relationship with LLEN senior management.

    As an example of what we have as true "on-the-ground" due diligence, below are just a few of our many pictures from our trips to Ping Yi in particular. While we have other pictures of the Ping Yi operations, we decided to focus specifically on the pictures in our collection that show LLEN's ownership in everyday life at the mine. These pictures were taken over the course of several of our trips to Ping Yi. We translated the signs and posters that appear:

    Picture #1:

    English: L&L; US L&L Energy Co., Ltd.; Guizhou Province Pan County Ping Yi Coal Mine; Office building

    Picture #2:

    English: L&L Ping Yi Coal Mine

    Picture #3:

    English: Establish a corporate safety image; L&L Ping Yi Coal Mine main inclined shaft; Do a good job of working safely

    Picture #4:

    English: Promote a safe and civilized production; L&L Ping Yi Coal Mine main shaft; Establish a mine safety image

    Picture #5:

    English: L&L Co., Ltd.; US L&L Energy; Pan County Ping Guan Town Ping Yi Coal Mine

    Picture #6:

    English: Ping Yi Coal Mine 600,000 tons capacity coal washing plant; Sichuan Weiyuan Silver Star Company Design and Manufacturing General Contractor

    As you can see in the above, there are multiple signs at Ping Yi which have been up and seen in existence over an extended period of time since we first started visiting the property till as recently as a few months ago. These signs clearly and undeniably indicate that LLEN is the owner and operator of the mine. These signs were not temporary; they were consistently at the site when we visited both announced and unannounced. Confirmation of LLEN's ownership is to be expected, as the company has:

    1. a published agreement with Ping Yi;
    2. a legal opinion from the largest law firm in the country stating they own Ping Yi;
    3. an independent auditor verification that they own Ping Yi;
    4. conducted an investor visit that allowed anyone to visit Ping Yi to verify the operations themselves; and
    5. consistent third party independent verification of the same.

    Clearly if Geoinvesting's purported owner of Ping Yi never sold his mine to LLEN as Geoinvesting would like shareholders to believe, then we find it quite odd that LLEN would, over extended, uncorrelated periods of time, have signs on the property that state that Ping Yi is owned by LLEN; strange that Geoinvesting's purported owner would enter into agreements saying LLEN owns the mine; peculiar that he would allow one of the largest law firms in China to provide a legal opinion (directly to LLEN's auditor without the involvement of LLEN) stating LLEN own the mine; and equally unusual that Geoinvesting's purported Ping Yi owner would let LLEN operate the mine and develop a second mining shaft that we believe will result in production resumption in the near future. Maybe Geoinvesting should also tell their Ping Yi "owner" that he should remove the US flags at Ping Yi, since Geoinvesting claims Ping Yi is not owned by a US company.

    Aside from our factual and truthful due diligence, we should note the character of Geoinvesting: that they are currently under lawsuit by other companies for share price manipulation and defamation. While these are allegations, we still think this is worth noting as it helps frame the character and integrity of their firm.

    Should LLEN pursue similar actions, they would have our full support, as it is clear to us that their motives are not to finding the truth, but one of deceit to profit from share price manipulation for their own trading accounts and the accounts of those that pay to front run the release of such negative allegations. Geoinvesting's actions have clearly damage the integrity and trust of the markets, and we feel that any action against them, either civil or criminal, would only serve to help restore ethics and accountability in the markets.

    As a side note: immediately after Geoinvesting posted on their blog about LLEN, we offered to have a representative of Geoinvesting meet us on-site at Ping Yi to do joint actual "on-the-ground" due diligence to discuss mutual findings. Geoinvesting outright declined such offer with no valid reason given.

    Additionally, should anyone want to see more of our pictures of Ping Yi or other mines of LLEN, we can typically accommodate such requests.

    We are long LLEN and intend on transacting to acquire additional shares or options.

    Disclosure: I am long LLEN.

    Additional disclosure: T Squared and our relationships (including corporate entities) plan on transacting to acquire additional shares and options of LLEN.

    Tags: LLEN, long-ideas
    Feb 21 5:43 AM | Link | 6 Comments
Full index of posts »
Latest Followers

Latest Comments


Posts by Themes
Instablogs are Seeking Alpha's free blogging platform customized for finance, with instant set up and exposure to millions of readers interested in the financial markets. Publish your own instablog in minutes.