This Campaign is now closed. We will inform readers of any developments, from the FCA or others, if and when they arise. A recovery of shareholders’ funds is unlikely.

This page was created to inform shareholders in Globo Plc about the events in October/November 2015 and thereafter.

The most recent developments are summarised in this blog in August 2018 by Roger Lawson
The FRC announced in summer 2018 that they have dropped the investigation on the basis that there is no realistic prospect of a finding of “misconduct” by Grant Thornton UK. It would seem that GT relied on the audits of the subsidiary companies in Greece and elsewhere over which the UK authorities have no jurisdiction.

Globo – The Sequence of Events

An organisation called Quintessential Capital Management (QCM) published a report on the 22nd October on Globo. The next morning the shares were suspended at the request of the company so as to enable them to provide a detailed response.

QCM acknowledged that they are active in short selling and had taken a short position in Globo. They also have links to Simon Cawkwell who was also involved in a similar attack on Globo in 2013. The main allegations then were that the Go!Enterprise product was not a useable software product and that profits were not turning into cash. The company’s share price subsequently recovered although criticism continued on some bulletin boards.

The company tried to raise some high yield debt in 2015 to enable it to make further acquisitions, but that was abandoned. Many investors may have taken a dim view on this business strategy for a software company in any case.

The allegations from QCM included the same ones as before but they also specifically focused on the company’s links to “suspected satellite” companies and partners/distributors even though the company recently claimed to be more focussed on direct sales. QCM claimed that 60% of Globo’s sales may be fraudulent but they acknowledged that “Globo’s cash balances may be genuine and backed by bank statements”. They also said that “it is also notable that, unlike many of its peers, Globo capitalizes its software development expenses, including a substantial portion of workers’ salaries” which seemed odd when there are specific accounting standards that require them to do so nowadays.

Subsequent to the above on the 26th October the company made three further announcements:

1. After an emergency board meeting, the CEO (Costis Papadimitrakopoulos), and the CFO (Dimitris Gryparis) had resigned and the COO had been suspended. A committee of non-executive directors had taken over after “certain matters regarding the falsification of data and the misrepresentations of the Company’s financial position” had been brought to their attention.

2. The joint corporate broker, Canaccord Genuity, had resigned.

3. The company advised that Costis had sold 42 million shares (more than half his previously reported holding) and pledged another 10 million under a loan agreement. The company did not yet possess all relevant information about those dealings. Failure to disclose director dealings or doing so when the directors are privy to non-public information is a serious breach of financial regulations.

That certainly appeared to validate many of the claims by QCM and the outlook for shareholders was undoubtedly bleak, with the shares continuing in suspension of course.

On the 30th October, the company also announced that:

4. The directors were trying to establish the financial position of the company, but the company has received a letter from its main creditor (a debt lender presumably) claiming it is in default.

5. The Nomad and joint broker, RBC Europe, had resigned (this was a serious matter as companies on AIM must have a Nomad in place or they get delisted).

6. Non-executive director Gavin Burnell had resigned.

On the 3rd November, the company announced that administrators had been appointed “by order of the court” and on the 4th November it was announced that COO Gerasimos Bonanos had resigned (all the other directors subsequently resigned). ShareSoc issued this press release on that date: Press071.

The administrators were FTI Consulting LLP and they said Our focus is to undertake an immediate assessment of the Group in order to evaluate any opportunities to realise value from the various businesses.  We will also be looking to gain control of the books and records in order to be in a position to undertake a full investigation.  These steps will be done in close consultation with the requisite regulatory bodies.” and “No dividends are expected to be available for shareholders.

On the 10th November, the company issued a further announcement reiterating the Administrators previous comments and disclosing that they did not have control over the Globo subsidiaries. The shares were de-listed and clearly the ordinary shareholders were likely to receive nothing from the administration. Note also that shareholders are not “creditors” under UK insolvency legislation and hence had no say in the process. The bankers to the company are likely to be able to recover something by having security over certain assets, but it is usual in administrations to find there is nothing remaining for unsecured creditors and ordinary shareholders.


One focus of investors will undoubtedly be the role of auditors Grant Thornton in this debacle, and the reasons for the change of auditors in 2014 which attracted some criticism but seemed to be reasonably explained by the directors.

One problem all investors have is that they normally have to rely on what the management of the company say, and on what the auditors report (who also typically rely on the word of the directors to some extent). If there is consistent misrepresentation then it can be difficult to detect. Some commentators had been consistently negative about some aspects of the Globo accounts over the years it was a listed company. However, other commentators had been positive on the company and tipped it as a “buy” until just before the administration.

ShareSoc does not give buy or sell recommendations of course, but we did cover the company in the past. For example as long ago as January 2012 was the first mention in our newsletter and we subsequently described it as a “double whammy of risk” in February 2012. Reports on all the Annual General Meetings of this company have been available to ShareSoc Members and the questions posed by shareholders covered many of the issues raised by negative commentators. The concluding comments in the last report were negative on the debt raising. 

It has subsequently become apparent that the published accounts of this company were a fiction, with the bank cash balances also being erroneous – or at least inaccessible to the administrators. In effect the accounts of this company were dressed up to look similar to those of any early stage, high growth software business. 

Possible Actions

ShareSoc formed a committee of shareholders to look at possible legal action and other steps to pursue recovery of losses. Any private investors who were significant holders of shares in this company should register their interest on this web page so as to receive more information as it arises. Several notes have been issued subsequently to shareholders in Globo who have registered their interest on this web site. The main points are given below.

Latest News 22/12/2015

The Financial Reporting Council (FRC) have announced an investigation into the audits of Globo conducted by Grant Thornton for the financial years ending December 2013 and 2015. 

Latest News 30/1/2017

The Administrators have published their Final Report on the administration and the company is being dissolved. It is clear that ordinary shareholders will not obtain any recovery of their investment in this company. At best shareholders might see some action by the legal authorities to pursue those responsible for this debacle.

Latest News 11/9/2018

The FRC announced in summer 2018 that they have dropped the investigation on the basis that there is no realistic prospect of a finding of “misconduct” by Grant Thornton UK. It would seem that GT relied on the audits of the subsidiary companies in Greece and elsewhere over which the UK authorities have no jurisdiction.

Please do support the campaign and obtain further information if you are a shareholder in Globo by registering your interest – you can use the form available below or call 0333 200 1595 (a national rate, not premium, number) if you have any questions. Anyone who registers can receive free Associate Membership of ShareSoc as an option which means you get some of our newsletters but otherwise there is no obligation involved.

If you wish to make a voluntary contribution to support the activities of ShareSoc please go to this page of our web site: Donations

Note that ShareSoc has considerable experience of these kinds of situations and will do what we can to advise and assist.