IA Global update: A telling May 2012 8-K filing

Regular readers remember I had studied this pre-Lehman-Shock player in the Japanese IT and services market. IA Global was headed up by the longtime acquaintance of Terrie Lloyd, and was on a buying spree (using stock) in Tokyo. They were using the company stock to do multi-million dollar deals. The problem, as I saw it, is that the stock itself was not worth anywhere near its trading price at the time, and these deals all ended up unwinding either before Lehman in September 2008, or shortly after it.

A recent 8-K filing by IA Global shed some light on what has been happening to that company since its stock imploded: it can’t file audited financials, because it can’t afford to pay the auditor. Even more, a number of former employees are taking it to court for back wages.

As I heard it from the Japanese side, the problem with IA Global was that it really didn’t “have” anything to trade for value with the companies that it was seeking to acquire or align with in Japan. What has always left me skeptical is why the Japan-side companies would have even been signing agreements with IA Global, for big seven or eight figure sales prices, without getting any solid assurance that the stock they were trading for was worth it. I really got the sense that this was a set of businessmen’s time-worn ideas to play greater-fool theory: create this trans-Pacific IT and dispatch services conglomerate, and expect that bigger would make it easier to leverage and to cash in ahead of yet other investors looking to buy in to Japan.

The transactions made no sense to me. Still don’t.

Someone asked me if I knew what became of the Lloyd New Zealand property that had been on the market after 311. As I say, it’s not really my bailiwick—I was more interested in the IA Global story, in the context of people and places in expat Japan that aren’t quite everything that one might conclude at first glance. However, a quick internet search suggests that the property is now one that you can rent out, as “Lloyd’s Beach House”, for anywhere from 350 to 500 Kiwi a night. Either the property didn’t sell, or was bought by an investor and that investor is renting it out. Make sense?

[Update 6/24/12: Looks like the property was sold through Bayleys sometime last year.

Peninsula Parade, Mangonui

David, our agent, had a vast knowledge of how to market our waterfront property most effectively and we enjoyed an exceptionally high response. We appreciated his professional assistance throughout our negotiation process with interested parties, and pleasantly surprised to find ourselves in an ideal multi-offer situation. In a difficult economic climate, we achieved the price we wanted within our time frames. K Lloyd

What’s odd is that whoever won the “multi-offer” situation is now just using the property as a daily rental—a bed-and-breakfast, basically.]