Gold miner Alkane Resources Limited (ASX: ALK) has seen its share price rise 18% in morning trading today, – before the company went into a trading halt around 1pm.
The volume of shares traded was also double it usual average – in just half a day.
And it seems the trading halt is so that it can make an announcement "in respect of a progress update on the approvals process for the Dubbo Zirconia Project."
Should the update be positive, it would point to the possibility of a leaky ship. Were some investors trading on information that wasn't public knowledge?
It remains to be seen whether the ASX Limited (ASX: ASX) or the Australian Securities and Investments Commission (ASIC) will take any action and investigate who was doing the trading and whether they have any links to the company or a part of the approvals process. We have yet to see the regulators investigate any previous issues we've raised.
Of course, it could always have been a number of investors speculating on the outcome – but then you have to wonder why the massive increase in volumes and urgency was needed, which forced the share price up. Yesterday, Alkane did lodge a company interview in which it stated that it was close to receiving approval for the Dubbo Zirconia Project. But nothing in the release suggested Alkane was going to get an update today.
Earlier this year, shares in Donaco International Ltd (ASX: DNA) fell 12.8%, before the company went into a trading halt near the end of the day. Shortly after the company announced that it was going to acquire an existing casino and raise some of the funds through a capital raising, and issue US$120 million worth of shares to the vendor.
In 2014, there were several instances we have found where shares either rose or fell before the company went into a trading halt and made a material announcement, including Gage Roads Brewing Co Limited (ASX: GRB), Goodman Fielder Ltd (ASX: GFF) and Horizon Oil Ltd (ASX: HZN).
In none of the older cases mentioned above did ASX or ASIC take any action. Unfortunately, I suspect we won't see any in this situation either.
