01 February 2009

Province takes shares for cash

The provincial government took shares rather than provide loans with eight of the companies identified by the provincial innovation department last year has having received cash under its commercialization program.

One of the share purchases – for Virtual Marine Technologies – was subsequently converted to a repayable loan.  VMT  received $450,000 of the half million it was originally supposed to received.

According to notes in the audited financial statements, "[t]he Province purchased 5,000 Class A common shares at a cost of $500,000. Of this total, $450,000 had been advanced as at 31 March 2008, with the balance held back pending delivery of certain financial information which remains outstanding. Subsequent to 31 March 2008, the equity investment was converted to a conditionally repayable loan. The 5,000 common shares were then cancelled and returned to the company."

According to a Telegram report in 2008, only three of the 10 cash injections was ever announced publicly. One – cash for MedicLink  - was announced in the House of Assembly while two others were featured in government news releases.

According to the audited public accounts for 2007, the provincial government took shares in:

  • Jackman Brand Marketing ($125,000 for 1250 Class B shares),
  • Pixecur Technologies a.k.a. DataSentinel ($400,000 for 4,000 preferred shares)
  • Dockside Appetizers ($31,000 for 310 common shares)
  • Mediclink ($352,000 for 3517 Class A shares),
  • NewLab ($500,000 for 5,000 Class A shares),
  • Northern Radar ($375,000 for 3479 Class A shares),
  • Virtual Marine Technologies ($450,000 for 5,000 Class A shares), in addition to the $500,000 in shares in
  • SAC Manufacturing.

With the exception of SAC,  all companies remain going concerns. NewLab merged with Newfound Genomics in 2008.The government did not take shares in a company manufacturing a pet restraint system for cars.