Shareholders in troubled vocational education business Vocation Ltd (ASX: VET) might need a long vacation after it announced its continued suspension from trade today.
The suspension is pending a release on its earnings guidance and finance arrangements, with all signs pointing to bad news when the company finally owns up to the depth of its problems.
The company said the reviews are of a "significant nature" involving "discussions with financiers" and that the market may expect an update by January 28. Having only been traded as a public entity for just over a year the business has been a textbook example of how investing in recent IPOs can sometimes be a risky business.
It already has several class actions being commenced against for it allegedly breaching its continuous disclosure obligations, with lawyers Slater & Gordon Limited (ASX: SGH) and IMF Bentham Ltd (ASX: IMF) leading the charge.
The stock was trading at 25 cents when the suspension was enacted and has lost around 90% of its value over the last six months. If the group were to announce a capital raising to help support it as a going concern it may face difficulty in drumming-up institutional interest given its recent history.
The Vocation story looks one to watch from the sidelines for now, if you're looking to build a big retirement nest egg you need to find rock-solid growth businesses with competitive advantages.
