#NJ deli valued at more than $100M delisted from stock market

Shares of a New Jersey-based deli owner that was recently valued at more than $100 million despite the fact it only operates a single store have been delisted from the stock market.

Cromwell Coulson, chief executive of the OTC Markets Group, the over-the-counter exchange where deli owner Hometown International’s shares had traded, tweeted late Wednesday that they were delisted “for not complying with the rules.”

The move comes six days after the Paulsboro, NJ-based sandwich maker was singled out in a client letter from hedge fund manager David Einhorn, who called the company an example of bizarre and risky investments that are threatening to ensnare small investors.

“The pastrami must be amazing,” Einhorn wrote of the deli.

The modest purveyor of meats and cheeses had achieved a market capitalization of more than $100 million despite the fact that its sole shop — located in a sleepy hamlet across the Delaware River from Philadelphia International Airport — only logged sales of $35,000 over the past two years, according to its annual filing with the Securities and Exchange Commission.

OTC’s Coulson said late Wednesday that shares of the company — whose shop is called “Your Hometown Deli” — have been marked by OTC Markets’ OTCQB over-the-counter exchange as “CE,” which stands for the Latin phrase “caveat emptor,” which means “buyer beware.”

OTC Markets Group also tweeted out a link to its “caveat emptor” policy, noting that the exchange “places a skull and crossbones icon next to the stock symbol to inform investors that there may be reason to exercise additional care.”

When a company is placed on the CE list, it means that OTC has become aware of either a stock promotion that is “misleading or manipulative,” an “investigation of fraud or other criminal activities,” “undisclosed corporate actions,” or has determined that there is “a public interest concern regarding the security.”

Hometown’s stock, which has traded as low as $4.75 a share last year, closed on the OTCQB market on Wednesday at $13.07 a share, up 2.5 percent from the prior day.

Hometown could not be reached for comment.

CNBC reported that since Einhorn’s letter went public, multiple people including investors and lawyers linked to Hometown have faced regulatory sanctions, lawsuits and criminal prosecutions. One key investor tied to Hometown named Peter Coker Sr. has been sued for hiding money from creditors and fraud, CNBC reported. Coker has denied any wrongdoing.

According to Hometown’s SEC filing, Coker Sr., who runs North Carolina-based Tryon Capital, has a $15,000 a month consulting deal with the deli owner. Meanwhile, most of the deli’s shares are held by two sets of entities in Hong Kong and Macau, China.

The other main shareholder is Hometown’s CEO, Paul Morina, who moonlights as the principal and head wrestling coach at Paulsboro High School, located half a mile from the deli.