Inland Homes (LON: INL) has managed to get itself into one of those corners where it leaves investors with a simple binary choice. There is no option for us to take decisions on a day by day basis - we have to make a decision to be in or out and to do so for some time. So, investors need to make that in or out choice in these next few days for however long it's going to take.
The background problem is that some “related party transactions” have been found. Leave aside the specific details of these at Inland Homes and just consider what is meant more generally. Officers of the company concluded certain deals - that's fine, that's what they're for, those officers. But a related party transaction is one where that officer has an interest not only as part of their job, they also have some part of that other contractual party. Their incentives are - to put it very mildly - not necessarily aligned with those of the shareholders they are paid to represent therefore. Related party transactions can happen, it's just that they're supposed to be declared, subject to much greater oversight and generally an ensurement that all is tiketty-boo.
Inland Homes share price from
So, certain of such officers of Inland Homes have left the company over those suspicions of related party contracts. The new Inland Homes directors had hoped to have the investigation into said contracts done and dusted so they could meet the 31 Match deadline. This isn't going to happen. Or, in more detail: “As a result of these matters, the Company will not be in a position to publish its audited results before the 31 March 2023 deadline stipulated in the AIM Rules. Consequently, trading in the Company's shares will be suspended at 7.30 a.m. on 3 April 2023. The Company intends to request a restoration of trading in its shares on publication of its FY22 audited results.” And it's that which produces the binary option.
Inland Homes shares won't be trading after the end of next week. Therefore the choice is to sell now and do something else, or hold on and hope that whatever is found about those related party contracts is minor - at which point the shares are relisted and presumably bounce. It's also possible to construct a trade in which shares are picked up now and then the risk taken for that unknown period of time.
The big issue though is that whatever way around anyone wants to trade it's both a trade of unknowable duration and also one where the decision has to be taken in this next week.