The Bear Cave #185
New Activist Reports, Recent Resignations, and Tweets of the Week
Welcome to The Bear Cave! Our last premium article was “Even More Problems at Roblox (RBLX)” and our next premium investigation comes out this Thursday, September 7. In addition, at 2pm ET on Friday, September 8, The Bear Cave’s author will be hosting a live Twitter Spaces stock pitch event with several up-and-coming fund managers. Listen in and learn more here.
New Activist Reports
Bleecker Street Research published an update on Atlas Lithium (NASDAQ: ATLX — $161 million), a lithium exploration company. Bleecker Street alleged that CEO Marc Fogassa claims he previously worked at Goldman Sachs when, in reality, he “was merely a summer intern there in 1997.” Bleecker Street also alleged the company’s upcoming $75 million stock offering means its stock promotion is coming to an end. In May, Bleecker Steet called Atlas Lithium “the most overvalued lithium mining company in the world.”
An independent blogger named “Zatoichigo” published on Western Alliance Bancorporation (NYSE: WAL — $5.60 billion), a regional bank that caters to small businesses. The author alleged Western Alliance inflated “fair value estimation of the loans transferred from held-for-investment to held-for-sale” and issued false or misleading statements regarding its deposit base and reliance on brokered deposits.
Hindenburg Research published an update on Tingo Group (NASDAQ: TIO — $200 million), a New Jersey conglomerate that claims to have phone services, food processing, and e-commerce businesses overseas. Hindenburg previously alleged much of the company’s purported cash balance was fake and now noted that “~$1.2 billion of Tingo’s claimed cash has disappeared through a series of advances and payments, including some to suppliers that don’t seem to exist.” Hindenburg concluded,
“We have never seen a scam so thorough, obvious and brazen as Tingo – a true outlier, even in a market rife with fraud.”
Recent Resignations
Notable executive departures disclosed in the past week include:
CFO of Canoo (NASDAQ: GOEV — $372 million) “will no longer serve” after just seven months. The company has had five different CFOs in the last three years as well as turnover among the Chief Technology Officer, General Counsel, and Head of Corporate Strategy. In May 2021, The Bear Cave criticized the company for “a slew of resignations, self-dealing, consistent losses, [and] a shifting business plan” and the company has fallen ~95% since its December 2020 SPAC merger.
CEO of Walgreens Boots Alliance (NASDAQ: WBA — $20.2 billion) “entered into a separation and transition agreement” after two and a half years. The company’s CFO also departed in July after five years “to pursue an opportunity in the technology sector.”
CFO of Viavi Solutions (NASDAQ: VIAV — $2.33 billion) resigned “to return to Europe to pursue a new opportunity” after two and a half years. In January, a board member also resigned “effective immediately” after nearly nine years.
CFO of Nasdaq (NASDAQ: NDAQ — $25.5 billion) “separated” after nearly three years.
CFO of Enviva (NYSE: EVA — $676 million) “entered into a separation and general release agreement” after five years. In March, the company’s Chief Accounting Officer resigned after one and a half years and in January the company’s General Counsel retired. In November 2022 the company’s CEO stepped down “to pursue medical and surgical treatment” and in October 2022 Blue Orca Capital criticized the company’s ESG disclosures and called Enviva “a dangerously levered serial capital raiser which generates nowhere near the cash from operations to support its dividends, which are increasingly funded through capital raising.” The company has fallen ~85% over the last year.
Head of Accounting at Skillz Inc (NYSE: SKLZ — $173 million) resigned after just five months “due to personal reasons.” The company has had four CFO transitions in the last three years and was criticized by Wolfpack Research for spurious partnerships in March 2021 and criticized by Eagle Eye Research for non-cash revenue recognition in April 2021. Skillz is down ~95% since its December 2020 SPAC merger.
Co-Chief Investment Officer of Apartment Income REIT (NYSE: AIV — $5.06 billion) departed after two years. The REIT’s prior Chief Investment Officer resigned after just five months in December 2020 “to take a new position in Southern California.”
Chief Accounting Officer of DigitalBridge Group (NYSE: DBRG — $2.81 billion) resigned “to pursue other opportunities” after nearly three years. The company has had three different CFOs in the last five years.
Chief Growth Officer of Rivian Automotive (NASDAQ: RIVN — $22.1 billion) “separated” after nearly three years.
Chief Accounting Officer of CSG Systems International (NASDAQ: CSGS — $1.74 billion) was “terminated without cause” after four and a half years. In addition, the company’s Chief Operating Officer and President of Revenue Management was “terminated without cause” after nearly three years.
Data for this section is provided by VerityData from VerityPlatform.com
What to Read
“A Private Phone. Secret Recordings. Inside One CEO’s Relationship With a TV Anchor” (WSJ)
“‘We were friends and I covered his company,’ Ruhle said in her deposition. Ruhle agreed with a lawyer when he asked if she had three devices: a work phone, a personal phone and a Kevin Plank phone. In her deposition, Ruhle also said she took free trips with Plank on his private plane.
When asked whether she was traveling as a Bloomberg reporter or as Plank’s friend, Ruhle responded: ‘I was flying on his plane as myself, Stephanie Ruhle. I’m not really in a category one or the other.’”
“Hindenburg report probe: Short selling in Adani shares led to ‘gains’ for 12 firms, ED to SEBI” (Indian Express)
“The Enforcement Directorate has concluded, after a preliminary investigation into the Hindenburg Research report and the subsequent market crash, that a dozen companies including foreign portfolio investors and foreign institutional investors (FPIs/ FIIs) based in tax havens were the ‘top beneficiaries’ of short selling in shares of Adani Group companies…
According to ED, which shared its findings with market regulator Securities and Exchange Board of India (SEBI) in July, some of these short sellers allegedly took positions just 2-3 days before the Hindenburg Research report was published on January 24, and some others were taking short positions for the first time ever.”
“Who’ll Stop the Raid?” (American Prospect)
“A little-noticed Justice Department case alleges that Alabama’s Medical Properties Trust engaged in ‘fraudulent conveyance.’”
Tweets of the Week
Until Thursday,
The Bear Cave