A WA-based tax-effective investment project aimed at raising about $10 million to produce a 40-minute long animated film has had an interim stop order placed on its prospectus by the Australian Securities and Investments Commission.
Called Hatchling, the film is aimed at the US institutional large format film market and is to be produced in WA.
According to the prospectus released by Pendragon Capital Limited, the film already has secured pre-sales of $US2.3 million.
Pendragon was trying to raise around $9.96 million to fund the project but the ASIC was concerned that forecasts contained in the prospectus could have been misleading.
ASIC officers felt the prospectus did not contain sufficient independent expert verification about the reasonableness of some assumptions underpinning financial forecasts.
The interim stop order prevents the offer, issue, sale or transfer of securities under the prospectus.
Project tax adviser Keith Platel said the ASIC had placed the stop order in cooperation with Pendragon.
“We had some conditions in the prospectus which hadn’t been met at that time,” Mr Platel said.
“We have all the appropriate experts’ reports so we are confident we can have the stop order removed at any time.
“When the time is right we will put in a replacement document, which is effectively a new prospectus including those experts’ reports, but we don’t have a rejected prospectus.
“Having a rejected prospectus can have bad connotations from a marketing point of view.”
