Something does not quite add up...
According to the compiled financial statements, L L Bradford assumed that there were negative retained earnings at the start of the reporting period. This would suggest that there was no cash or very close to no cash in the bank.
The press release suggested that BGMO earned $ 88 million in the first month but it must remain on account for a year.
If there was no cash on hand and the remain cash or cash equivalent was out of reach then how could Bergamo make an offer, in good faith, to fund VSTA knowing that it would not have any cash until one year after the high yield profits are released?
The only reasonable way according to my neighbour would be if BGMO could convince a domestic bank to lend money based on the funds held in reserve in Europe. My experience with domestic banks is that they generally will not trust anything oversees unless it is a major institution. Even then, it must be liquid and assured in some fashion to pass the credit department tests. Since the funds are locked in, they would not qualify as security for a bridge loan to fund VSTA.
Based on the BGMO financial statements and the two PR's (the VSTA investment and the high yield program), it makes sense for BGMO to defer the VSTA investment as there would be no reasonable way for BGMO to fund them. The other way to look at this is that someone noticed the timing problems and let BGMO know of this so the dates were changed.
