Dublin businessman Nial Ring profits as shareholders suffer at small caps

Dublin businessman Nial Ring has said he made a “reasonable profit” from trading in the shares of three publicly quoted companies that have racked up losses of approximately €7 million between them.

The companies, Proventus Renewables, US Oil & Gas, and IMC Exploration, are all Dublin-based small-cap companies traded on the Danish-regulated GXG exchange and with a lot of Irish shareholders. Ring was also involved with, but did not have shares in, a fourth plc, Teknomining.

The four companies are sitting on total accumulated losses of approximately €8 million, according to their filed accounts, and illustrate the risks associated with investing in small cap start-up plcs and exploration stocks.

The ventures are involved in developments as diverse as a renewable energy project in Bulgaria, drilling for oil in Nevada, looking for gold in Wexford and looking for mineral ore in Turkey. Captive Audience Display Solutions plc, an earlier incarnation of Proventus, was involved in a project to put screens in petrol station forecourts and create an income stream from advertisements.

Substantial paper losses

The companies’ share prices have varied hugely, meaning that some investors made significant returns, while others are sitting on substantial paper losses.

All four companies also involve Mr Ring’s business associate, Liam McGrattan, with the two men specialising in matching potentially lucrative projects to finance-raising structures. Although the four companies have not as yet produced a return for the millions of euro that have been invested in them, both men say this is to misrepresent the situation as the companies are focused on building the value of their assets, rather than producing an income.

Two of the companies, IMC and Proventus Renewables, have their registered offices at 70 Ballybough Road, Dublin 3, above The Ref pub, which the men own.

When asked about the four companies not producing an income, Ring said he would dispute such a description. No-one made such comments about Providence Resources plc, he said, referring to the €113 million market cap oil and gas exploration group quoted on the Alternative Investment Market in Dublin and which had just announced 2013 operating losses of €7.23 million on the day he was interviewed.

“It’s not like running a corner shop, where you put your money in and get an immediate return.”

He said he had invested substantial amounts of time and money in the companies and had “no doubt” that Proventus and IMC would prove successful. “Profit is one way of describing success, but enhancing asset value is also.” As well as his earnings from shares he sold, he still has more shares “that are worth a lot of money and that I believe will be worth substantially more”.

He said a lot of shareholders made money from their investments in the companies. As for those who had lost on their investments, he said he had also sometimes lost out from investing in shares.

“We are all big boys. We evaluate the management teams and the projects and we put the money in.” He had made money and lost money investing in Providence, he said. “No one is saying to Providence, your profit and loss account is showing a loss. They are doing work of national importance, which we would say we are doing with [IMC in Wexford].”

‘Building assets’

McGrattan said the companies may not have produced an income but that was not the point. “We are building assets.” He said it was not a question of his profiting from selling shares. He has shares in the companies and wished he had more because he believed they will increase in value. “I can’t get enough of them.” He said he did not know of “one disgruntled shareholder in any of the companies” and had lots of cards in his office from people thanking him because of the returns they had made on their share investments. He has more such cards than the chairmen of AIB or Bank of Ireland, he said.

The shares of mining company IMC were down at the moment because mining companies globally have lost a lot of their value. “We can control the companies but we can’t control the price of gold.” He is the chairman of IMC and said it is an “absolutely excellent company that will continue building its assets not just for the shareholders but for the Irish people”.

Ring is an accountant, banker and former business partner of Dublin property developer and Fianna Fáil Ard Comhairle member, Jerry Beades. He was a government appointee to the board of IDA Ireland, where he served for 10 years until 2008. A long-time political associate of the former Taoiseach, Bertie Ahern, Ring was elected as an independent councillor on Dublin City Council in the recent local elections, having been elected for the first time in the 2009 polls.

He ran as an independent rather than under the Fianna Fáil banner in the 2009 elections. Fianna Fáil left him rather than the other way round, he said. “I don’t know why.” He never had a falling out with Ahern, he said.

Ring is interested in being deputy Lord Mayor of Dublin for the 1916 centenary celebrations. The position is due to go to an independent. His grandfather and four of his grandfather’s brothers, he said, were in the GPO for the Rising.

Sales background

McGrattan has a background in sales and finance. He was involved in leasing company Custom Finance Ltd and has over the past decade specialised in the small cap equities market.

A video on Youtube uploaded seven months ago and which shows McGrattan being applauded by staff as he leaves the Shelbourne Hotel, Dublin, bears the title: The Shelbourne Hotel's long stay resident Liam McGrattan leaving after two year stay. Asked about it, McGrattan said it was a private matter.

Ring’s sister-in-law, Lisa McDonnell, is a former director of Cads while her brother, Brian McDonnell, is chief executive of US Oil & Gas and a former director of Proventus.