AH yes making more news by ssame folks that covered GLKC mess StockGate: 1.3 Billion Shares Trade In Company That Last Week Had Only 11 Holders financialwire.net May 27, 2005 (financialwire.net via COMTEX) -- May 27, 2005 (FinancialWire) May 27, 2005 (FinancialWire) Gluv Corp. (OTC: GVRP), which has been supposedly reverse merging into a company to be named Media Magic ( http://www.mediamagicinc.com ) traded 1.3 billion shares Thursday.
Since the company supposedly has only somewhere between 11 and 33 million shares, with Ameritrade Holdings (NASDAQ: AMTD) among the brokerages reportedly holding the bag for the rest, the trading is somewhat reminiscent of Global Links (OTC: GLKC), which has left E*Trade (NYSE: ET) hopelessly short after two individual shareholders filed SEC statements saying they had acquired more than the outstanding shares of Global Links.
Gluv Corp. has asked the U.S. Securities and Exchange Commission to halt its trading until everything gets straightened out.
Waiting in the wings are Gerald C. Parker and Robert W. Pearce, scheduled to become chair and CEO, whose Media Magic owns DigiKidz, Inc. and Orangebox Entertainment.
DigiKidz is a leading producer, developer, distributor and eCommerce retailer of a range of personalized videos, books, CDs and music for the children's marketplace. Orangebox, located in Hollywood, California, is an innovative company that provides the next generation of multimedia services ranging from Production to Post Production for the entertainment industry. Its services include audio, visual, editorial, and music from inception to completion. On May 17, Parker commented: "We are excited about our current prospects and look forward to developing Media Magic Inc. into an innovative, well-rounded leader in the entertainment industry through several acquisitions."
Now, he may be having some second thoughts.
To prepare for the merger, Gluv Corp. is said to have spun off its own assets to leave its shell to Media Magic. As part of the process, the company did a 1-for-6.25 million reverse split, which left only 11 shareholders. Then it planned to complete a 3 million-for-1 forward split that would produce 33 million shares.
According to the company, apparently some 3 million shares of the company's common stock were issued prior to the dividend payment date. According to the company, it appears that an unknown number of those shares have been improperly traded in the marketplace.
The company said it is investigating how 3 million got into the marketplace, and had asked the SEC to halt its trading.
That didn't seem to deter traders yesterday, as they churned 1,362,506,898, closing at $0.0002, up 100% from $0.0001 the previous day.
The question is, do most of those shares even exist?
With over 300 companies with nonexistent shares listed on various exchanges' SEC Regulation "SHO" threshhold lists since January 7, it's hardly a new phenomenon.
At least one media said that 590,000 shares traded while there were only 11 outstanding.
That may be a new record for naked short selling, even if the brokerages thought the trades were backed by existing certificates.
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