"In response to an SEC filing made by an entity purporting to be named "PTG Capital Partners", Avon reports that it has not received any offer or other communication from such an entity and has not been able to confirm that such an entity exists," an Avon spokesperson told Forbes by email.
That should put to rest speculation on whether or not Avon is subject to a takeover offer. There were obvious red flags the minute the offer crossed newswires. No one's ever heard of PTG and the apparently fraudulent London-based firm couldn't even spell its name correctly throughout the SEC filing. Meanwhile, PTG's alleged Fort Worth-based legal advisor, Trose & Cox, is bogus according to the building manager at its listed address.
A call to PTG, which claims to be based adjacent to The Bank of England was not answered and there was no ability to leave voice-mail.
In a discussion of the firm, PTG jumbled its acronym, writing "TPG" multiple instances (emphasis ours):
About PTG Partners: PTG Partners is a global private equity investment firm, focused on leveraged buyout, growth capital and leverage capitalization, investment in distress companies and turnaround situations.We are problem solvers,partners and pioneers. TPG's approach to investing helps us to recognize value - or the potential for value - where other cannot see it.
Furthermore, the firm's 'About PTG' section was copied from the wikipedia page and website of TPG Capital, an established private equity firm. "We are problem solvers, partners, and pioneers," the filing stated, a direct copy of TPG's website. [TPG isn't involved]
PTG listed a Michael Trose, of Trose & Cox PLLC as a contact. The address of Trose & Cox was listed as 777 Main Street, Fort Worth, Texas, and with a phone number: (817) 887-8000. A call to the firm was answered by a representative at Atrium Executive Business Centers, who characterized the Trose & Cox as "bogus" and not a tenant.
PTG's fake bid mirrors a somewhat similar scenario in 2011 when a firm called Sterling Global Holdings offered to buy American Airlines for $3 billion.
The deal never materialized and the SEC got to the bottom of it sanctioning Allen E. Weintraub of AWMS Acquisition $400,000.00 for making fake tenders for American Airlines and Eastman Kodak. Weintraub, according to the SEC's complaint, did make an effort at an LBO by walking into three Miami bank branches asking for loans of $3 billion, $3.5 billion and $1.3 billion, respectively.
""[F]ilers are responsible for the truthfulness of their filings, and they are subject to enforcement actions when they are false or misleading," a SEC spokesperson told Forbes by email on Thursday evening. If the SEC were to investigate the Avon matter, it might look to a fake 2012 tender for The Rocky Mountain Chocolate Factory.
In that instance, a Kings Cross, London-based firm called PST Capital Group LTD offered to buy the company for $13 a share and listed bogus contacts in the U.K. and California. The 'About PST Capital' section of that filing also copied boilerplate language from established PE firm GTCR.
"PST Capital is a private equity firm pioneered "The Leaders Strategy" - finding and partnering with exceptional leaders," the filing stated, a copy of GTCR's website. The fake tender offer from PST caused a spike in the trading volume of Rocky Mountain Chocolate. [No typos in that fake bid]
Avon Products shares rose as much as 20% on PTG's filing, but were then halted. When Avon resumed trading, shares erased most of their gains, trading a little under $7 a share.
When asked what might be done to ensure fake buyout bids don't become routine, Jerry Reisman, of Garden City, NY-based law firm Reisman Peirez, Reisman and Capobinaco, told Forbes, "in reality the SEC's hands are tied. They are dealing with cyber criminals.”
He suggested international laws to extradite criminals profiting off of fake buyouts before murmuring, "by the way, they could be fourteen years old!”
