Your Hometown Deli in Paulsboro, NJ
Hometown International – the strange, listed company with a market value of more than $ 100 million despite owning only a small deli in New Jersey – has announced plans to merge with Makamer, a private bioplastic start-up company.
The money-losing Your Hometown Deli in Paulsboro, NJ, which is owned by Hometown International, will not be run by the company that will be the result of the merger with the Los Angeles-based Makamer. It is unclear whether the delicacy will close or continue to sell sandwiches, sodas, chips and other dishes.
The announcement of the merger of Makamer and Hometown International comes almost a year after hedge fund manager David Einhorn noted in a client letter the bizarre difference between the deli’s extremely modest sale, which was $ 25,004 for the whole of 2021, and Hometown’s soaring stock market rating.
“The pastrami must be amazing,” Einhorn said in the most quoted line from the April 2021 letter.
On the heels of that letter, CNBC described the tangled business connections and controversial history of a number of people associated with Hometown International, whose CEO at the time was Paul Morina, high school principal and head wrestling coach at Paulsboro.
Morina is still listed as the owner of 31.5 million shares in Hometown International.
In its annual report, filed with the Securities and Exchange Commission on March 18, Hometown International revealed that “the company has identified a potential target company and is currently involved in discussions about a possible business combination.”
Makamer CEO speaks with CNBC
Alex Mond, the head of Makamer, told CNBC in an interview on Friday that he expects the merger with Hometown International, which was revealed in an SEC file on the eve of the April Fool’s joke, to be completed “in a few weeks.”
Then, Mond said, he plans shortly after transferring what will be the bioplastic company’s new stock trading symbol to Nasdaq from the over-the-counter markets.
Mond said Los Angeles-based Makamer considered Hometown an attractive merger candidate, even after the headline about the deli owner because of its status as a listed company.
“We have investors who pressured us to go public,” he said.
Mond said a listing would make it easier for Makamer to get much-needed money to grow his business, which was launched more than three years ago by issuing debt.
Mond said Makamer is in discussions with “large companies interested in selling our product,” which are designed to replace petroleum-based plastics and to reduce the amount of plastic pollution in the world’s oceans and on land.
“We are awaiting purchase orders,” Mond said.
“We use 45 different mixtures, mainly hemp,” Mond said of the company’s bioplastics.
“Hemp is the best substitute” for plastic, he said, noting that “it uses the least amount of energy and is easy to grow,” is renewable and “also cleanses the soil” of pollutants.
The stock price hits $ 14 per share. shares
The SEC filing announcing the proposed merger, which was made by Hometown International under the new name Makamer Holdings, did not reveal how Hometown International and Makamer were each valued in the merger, or how the approximately 60 shareholders in Hometown International will fare. in the trade.
HWIN, the current symbol of Hometown International, trades at very low volume, if at all, on OTC Markets’ Pink platform, an over-the-counter listing service.
OTC Markets in April 2021 delisted HWIN from its OTCQB platform, moved the stock to the less prestigious Pink market and gave a “buyer beware” warning to the deli owner “for not complying with the rules” for OTC Markets.
As of Friday, Hometown International’s share price was $ 14 per share. share, giving it a market value of $ 109.2 million, based solely on outstanding shares alone.
The last registered trade of the stock was for 100 shares on March 8th. Prior to that, the last registered trades of the stock were for the same number of shares on December 31st.
‘More details to follow soon’
Peter Coker Jr., the Hong Kong-based investor who is Hometown International’s CEO, said in an email response to being asked about the merger: “Everything available for discussion has been published in SEC Form 8K. “
“More details to follow soon,” wrote Coker Jr.
Manoj Jain, the founder of Maso Capital in Hong Kong, which is a major investor in Hometown International, declined to comment through a spokesman.
For more than a year, Maso Capital had positioned Hometown International and another related listed shell company, formerly known as E-Waste, as vehicles for private companies to merge with and even become listed.
Last year, E-Waste entered into a reverse merger with EZRaider Global Inc., a privately owned electric car company. Even before the merger, E-Waste had a market capitalization of $ 110 million despite having no business operations.
On the heels of CNBC reports on Hometown International and E-Waste, in highly unusual applications to the SEC, both firms rejected their shares ‘publicly traded stock process, saying they were unaware of any basis to support their companies’ high market values.
Other major investors in Hometown International include investment funds from two US universities, Duke and Vanderbilt, where these funds have postal addresses in the same building as Maso Capital.
The largest shareholders in the delicatessen are a group of opaque entities in Macao, China, whose postal addresses are located on the same floor of the same office building there.
Concern about leadership
Mond said in the interview that he and his current management at Makamer will be responsible for the merged company, despite the initial desire of people currently involved in Hometown to have management roles in the company when merger discussions started last year .
“They were not ok with it, but that was our condition,” Mond said. “That was my whole management, otherwise I would not take the deal.”
Mond said he was aware of the legal and regulatory controversies surrounding the people involved in Hometown before being contacted by two “Wall Street guys” he knew who were proposing merger discussions.
“I was worried” about these controversies, Mond said. “Therefore, I made sure that our management takes over and not the old management.”
Mond said that during the merger negotiations, he only spoke “very briefly” with Coker Jr., the president of Hometown International.
“Maybe three or four minutes,” Mond said, referring to the length of his conversations with Coker Jr. on the phone.
Mond said his main point of contact in the negotiations was with Hometown International’s lawyers and “also James Patten.”
CNBC reported last year that Patten at the time worked as a financial analyst at Tryon Capital Ventures, a North Carolina investment company owned by Coker Jr.’s father, Peter Coker Sr.
Patten had also struggled in high school with Morina, Hometown International’s largest shareholder and its former CEO. His LinkedIn profile shows him as the leader of the Mantua Creek Group, a partnership of which Morina is a member and which leases space for the Paulsboro Delhi.
Patten is also excluded by FINRA, the broker-dealer regulator, from acting as a stockbroker or associating with broker-dealers, according to the regulator’s database.
He has previously been the subject of repeated disciplinary action by FINRA, which included failing to comply with an arbitration award of more than $ 753,000 for violating securities laws, unauthorized trading and discarding a client’s account.
Coker Jr.’s father, Peter Coker Sr., is listed as the owner of 1.3 million shares in Hometown International. Coker Sr. and his business partner at Tryon Capital, Peter Reichard, controls another entity, Europa Capital Investments, which is listed as the owner of nearly 2 million shares in the deli owner.
Coker Sr. has previously been sued for allegedly concealing money from creditors and alleged business-related fraud. He has denied wrongdoing in these cases, one of which was settled out of court in recent years in North Carolina.
Peter Lee Coker mugshot from Raleigh / Wake City-County Bureau of Identification (CCBI).
Source: Raleigh / Wake City-County Bureau of Identification
In August 1992, the then 49-year-old Coker Sr. arrested in Allentown, Pa. and charged “with prostitution and other offenses after he allegedly exposed himself” to three underage girls while driving around Central School, “The Morning Call reported at the time. Records describing the outcome of that case, are not publicly available.
Coker Sr. was arrested in North Carolina in 2010, charged with soliciting a prostitute.
In 2011, Reichard filed a plea in a criminal case that led to his conviction for a plan to illegally contribute thousands of dollars to the successful 2008 campaign for North Carolina’s governor Bev Perdue, a Democrat.
The scheme involved the use of a false consultancy contract between Tryon Capital Ventures and a fast food franchisee who wanted to support Perdue. Coker Sr. was not charged in that case.
CNBC last year detailed that Tryon Capital was paid thousands of dollars a month for advising both Hometown International and the related shell company, E-Waste. Both of these companies terminated these consulting contracts in continuation of this reporting.