ALLIED BRANDS LAUNCHES MASSIVE SHARE DEVALUATION PROGRAM

Allied Brands Ltd has today launched a plan to find 2,000,000 more suckers interested in buying shares and enjoying their fall towards zero.

ABQ SHARE RIPOFF

This represents another 12% dilution of existing shareholder equity. The majority of these funds to be given (loaned, haha) for the purchase (gift) of $750,000 to the current non-performing CEO, Shane Radbone.

AND AS PART OF THE "EXTRAORDINARY" MEETING, MANAGEMENT HAS ASKED FOR THE RIGHT TO ISSUE ANOTHER 15% OF NEW SHARES! MORE DILUTION!

ALLIED BRANDS MOTTO

VILLA & HUT - ANOTHER SMALL FRANCHISE TO BE VICTIMISED BY THE PROS AT ALLIED BRANDS

Allied Brands Ltd. has announced, over the signature of Peter Graham (profiled below), the purchase of another small franchise group.

Welcome, new small business franchisees to be victimised! Read about your future with Allied Brands in this blog! Kiss your business goodbye!!

Villa & Hut is a two-business company. One part sells overpriced furniture and other homewares junk imported from Indonesia and elsewhere. The kind of products that stop selling during recessions. The other part is an eco-friendly coffee shop chain. Despite talk of synergies and cost savings between this part-coffee-shop chain and CookieMan, this has never come to pass with the previous acquisitions by Allied Brands. It won't be long I guess before these Kafes are selling bad cookies instead of their current line of unique "eco-friendly" products.

In the announcement, Allied Brands is paying "$1M and assuming debts of $1.8M". Does this sound like a successful business? It mostly sounds like the bailout of a failing, distressed business from a failed franchisor. With this kind of debt load, the ACCC should investigate if Villa & Hut was trading while insolvent - the giveaway price to Allied Brands seems to indicate trouble, despite claims to the contrary.

And the announced finance strategy is stranger still. Allied Brands claims the business is "cash flow positive" despite the massive debt load and giveaway price they are paying. Allied Brands is offering existing shareholders $10K in additional shares, up to $2M in new capital. Why are they raising $2M when they only need $1M to pay Villa & Hut?

Allied Brands CEO Shane Radbone is acquiring 5.0M shares in ABQ at .15 ($750,000), paying for this new stock with an "executive loan" from the company! So existing shareholders are being asked to see their shares diluted further in order to give $750K to the CEO of a failing company! Usually, executives are rewarded for success. The continuing decline of Allied Brands operations, bleeding of cash, inability to sell new franchise locations, and share price collapse are not by any measure "success". And yet $750K is being stripped from the company's declining cash reserves to reward Mr. Radbone? Breathtaking!

The company announcement says this loan for shares is being provided "on commercial terms". What commercial terms? There is no commercial bank on earth that would loan 100% of the purchase price on Allied Brands shares, or any other shares. Isn't 100% share leverage illegal? Isn't this one of the greedy tactics by business that has caused the world financial crisis?

Additionally, Peter Graham's announcement admits that the additional money raised is being used to "prop up" the company's working capital!

DEAL SUMMARY

Buy a $1M company, get almost $2M in debt and ask shareholders for another $2M in capital, give a third away to a non-performing CEO, and use the rest to plug the cashflow hole in the existing businesses.

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We are attempting to contact Villa & Hut founder Franz Madlener to determine why he's selling what was previously thought to be a successful company so cheaply to these Allied Brands charlatans. Previously awarded as a "SmartCompany" award winner, Madlener has clearly made a deal with the devil for unknown reasons. These are not the actions of a "SmartCompany", they are the actions of an ignorant fool. As well as the existing franchisees who have already been in touch with this blog and sound both angry and disappointed in Mr. Madlener, we should have some further information later today. And we look forward to finding out how the many Indonesian and other suppliers to Villa & Hut feel when they hear how fellow Asian neighbours, the Koreans, have had their lives and families ruined by their purchase of Baskin Robbins shops and residency visas.

After the announcement of this "deal" by Allied Brands, initial sharemarket reaction? DOWN! You can bet these people will be in there "spinning" this yarn into something special today. It usually takes a few days to weed out the suckers and get the truth to reflect the reality! With more share dilution (in favour of management) and massively increased debt load, the only possible direction for these shares is DOWN.

UPDATE: ATTEMPTS TO CONTACT FRANZ MADLENER UNSUCCESSFUL. OFFICE STAFF SAID HE WAS "OUT CELEBRATING". WE'LL KEEP TRYING.

COOKIES LOADED WITH RATS! NSW GOVERNMENT PENALTY NOTICE FOR COOKIEMAN, MIRANDA

The New South Wales government has now published the results of food safety inspections in the Sydney area.

Of course we find a CookieMan shop listed for having rodent infestation. Usually, franchise businesses have frequent inspections from the franchise company that are more intensive than the occasional government inspection. So how can such a major rodent infestation go on for so long, ignored by the franchisor Allied Brands and CookieMan, until finally the franchisee is given an infringement notice?

READ THE REPORT HERE

It seems that same standards of franchisee support for Baskin Robbins shops (NONE) is now the standard with CookieMan since Allied Brands took control of the CookieMan company. Franchisees have complained of "never seeing anyone" from the company, with the result that ALL the franchisees suffer from the lack of standards at Allied Brands. Franchisees PAY for standards. They just don't get them.

There is also a report of huge rat infestation at 36 Seabeach Avenue, Mermaid Beach Queensland. This is likely just Allied Brands management, however.

ALLIED BRANDS PLAN MEDIA PUSH TO INCREASE SHARE PRICE

Sources inside Allied Brands Ltd (ABQ) have written this blog saying that ABQ managers are spending lots of time recently preparing media plans - not for franchisees to sell more ice cream or cookies but instead trying to push Allied Brands share price higher.

Allied Brands has long history since becoming a public company to try these media "tricks" whenever they are under some financial pressure. Peter Graham the Managing Director of Allied Brands has signed all of these statements that apparently he believes are true when he gives them to the media. Or maybe he doesn't believe them. Here are some examples:

16 Apr 2008: Big announcement about Cookie Man International expansion. NOTHING HAS HAPPENED

12 March 2008: Says company has "undertakings or deposits" for 25 new stores to open by July 2008. ANOTHER STATEMENT NEVER HAPPENED They never tell investors how many stores are closing. Misleading, misleading.

3 December 2007: Says company will see "significant boost in store numbers in WA" in eighteen months. Says "we will increase number of Kenny's Cardiology stores to 18 over the next 18 months". The result after 18 months? FIVE STORES with TWO SHOWN AS FOR SALE.

This press statement also says Allied Brands is obtaining sites first to prove they work, and then finding franchisees. This hasn't happened. Results speak for themselves. Why are 40% of Kenny's Cardiology shops in Western Australia for sale? Don't they know the company is planning big expansion?

The "big expansion" also means Sydney, with 11 shops, has FIVE FOR SALE - ALMOST HALF THE FRANCHISEES TRYING TO GET OUT!

Now we are starting to hear and collect truthful stories from Kenny's Cardiology Shops about their experiences with Allied Brands. They are telling us more soon. Thank you for writing to us.

20 November 2008: Big press release telling everyone it would start Cookie Man shops in "at least three new countries by the end of 2008". They say "strong interest" from these countrys would make them open there.

ANOTHER STATEMENT NEVER HAPPENED

Allied Brands has many investors angry with the bad performance of the company and these investors are starting to question every publicity statement the company makes now.

Recently on 23 May 2008 company told newspapers that they can give Matt and Drew Edwards, previous owners of Awesome Water company, their full bonus payment for selling their company to Allied Brands and meeting their targets. You can read this statement HERE. This payment however looks like another trick - the Edwards agreed to take this payment in Allied Brands shares valued at .65 cents! So instead of the $5 Million final payment they were expecting (or more, because they were of course told Allied Brands stock would be soaring under Peter Graham's leadership), they get $1.4 Million. $3.6 Million less than they expected! Are they happy with losing so much money to Allied Brands management?

Maybe this was always the real plan by Allied Brands, to keep the share price low until after the company saves so much money?

The announcement says the Edwards were "understanding in light of market conditions". Are they understanding about the bad and failing operations they see all around them? Will they ever get real fair value for the business they worked hard to establish? Do they even question management as to why all these grandiose plans have failed so spectacularly??

8 July 2005: This shows how long the history of misleading or wrong company statements can be. On 8 July 2005 Peter Graham announced ALLIED BRANDS WILL BUY WENDY'S. This never happened, the company never explained why, but Wendy's franchisees all realise their good profits were going to vanish if they were forced to be Baskin Robbins brand. Allied Brands also says in this press release that they have 88 Baskin Robbins stores open. To this day 88 stores have never been open at the same time. New ones open, and others fail.

So why are Allied Brands managers now working on new public statements and press releases? Do they think the public and investors will be fooled by more announcements that never come true? Do they think they can trick us all again?

Look at Australia Stock Exchange record on Allied Brands statements. Can you find one that ever comes true? NONE. LOOK FOR YOURSELF!

WE ARE ALL VERY EXCITED WAITING TO HEAR ABOUT WHAT KIND OF FUNNY STORY PETER GRAHAM WILL GIVE US SOON!

WHAT'S CAUSING THE ALLIED BRANDS ICE CREAM SHORTAGE? NO VANILLA???

Several current franchisees have written and attached copies of messages from Allied Brands - showing that widespread shortages of ice cream, supplies, and other items continue to plague the franchisees. Along with all their other problems.

There seems to be no rational explanation of why the last six months have seen supplies dropping to critical levels. Today however shops in Sydney were told NO VANILLA IS AVAILABLE!

NO VANILLA???

How are shops supposed to make cakes?

NO VANILLA???

Speculation is running that there is only one reason for the prolonged ice cream shortage. It's related to Allied Brands prolonged bleeding of cash, with cash on hand slashed by over 50% at the half-yearly report. And with revenues dropping, franchisees failing, and Allied taking over company operation of these failed stores, is it possible that Allied Brands is running out of cash?

What else explains the continual shortages of product.

NO VANILLA???

ADVERTISEMENTS OFFERING AUSTRALIAN VISAS WITH PURCHASE OF AUSSIE BASKIN ROBBINS STILL APPEARING

More ads have been found touting the "great GUARANTEED opportunity" for buying a Baskin Robbins shop from Allied Brands, which includes Australian permanent residency visa (at least according to this ad).

What kind of "GUARANTEED OPPORTUNITY" is this? So far the only guarantee provided to Korean people has been the loss of their investment and ultimately deportation from Australia back to Korea.

ALLIED BRANDS ROCKED BY BASKIN ROBBINS MIDDLE MANAGEMENT EXODUS ! !

Details are sketchy as several Baskin Robbins franchisees have received calls from senior management to "shut up" talking to the media. One was told "a big deal" is in the works, and continued discussion about "minor problems" would destroy a deal that's good for all franchisees.

We've heard it all before.

CRAIG CLARKE was hired with great fanfare as the "Franchise Business Manager" for New South Wales shops. This is where the greatest concentration of "Korean Visa" shops has developed, and the massive level of problems with this and the other stores have just pushed him over the edge. He said to one franchisee "I'm just the front man to take the (franchisee) abuse for a system that doesn't work".

STEVE HALLS has been around a little longer, and was said to have been a failed coffee shop franchisee. Nice going. He's now left as well, and under what are reported to be similar circumstances as Craig Clarke.

These are positions that Allied Brands has failed to staff correctly for years. As senior management seeks to insulate themselves further from the crumbling franchisee network, poor dummies are roped into a management position with a fancy title, and told little about what awaits them when they are sent out like so many slaughtered lambs.

Allied Brands has not even bothered to send any of them for Baskins training in the US - they're expected to fail, I guess.