Message #22 From:
T.A. Dickson Date: March 22, 2007 10:31:10 AM
Undervalued CNCN INFO!
I don't think many investors realize how undervalued CNCN is right now as a result of these nicely accretive financings from some significant names in Korea's financial industry.
Unless I am completely misreading/misinterpreting the filing, it appears to me that the $63 million financing from Woori is just one part of this round of financing (which is scheduled to be officially signed at Woori's offices on April 12). Again, I could be wrong on this but it looks like affiliates of the Bokwang conglomerate will be investing more than $10 million in CNCN before or on the closing date, bringing the total amount of money raised in this round to more than $73 million......
Affiliates of Bokwang Group, such as Phoenix Development & Investment Co., Ltd., Phoenix Digital Tech Co., Ltd., etc. shall have subscribed to the convertible bonds issued by the Company in the amount of at least KRW 10 billion under the terms and conditions that are not more favorable for the foregoing parties than those for the Subscriber, on or prior to the Closing Date.
Assuming my above take on this latest financing is correct, here are some quick calculations. On a fully-diluted basis I believe prior to this financing there were about 130 million shares outstanding (it is probably less than that, but I'll just use this number). Following this round of financing the fully-diluted share count is probably in the neighborhood of 235 million shares outstanding.
This financing alone will result in CNCN having more than $73 million in cash (more than 31 cents per share) sitting on its balance sheet prior to any acquisition it makes. Today's closing price gives CNCN a fully-diluted market cap of less than $78 million. The market is giving CNCN a valuation of basically $5 million. I am invested in shells that have higher valuations than that.
At some point light bulbs are going to go off in the minds of some investors. Woori and possibly Bokwang investments, NASDAQ and London Exchange listings..
The Company has undertaken to apply for listing of its common stock on any of the NASDAQ, London Stock Exchange, Hong Kong Stock Exchange and Singapore Exchange Securities Trading Limited and use its best efforts to obtain such listing by October 31, 2009. In the event that the Company does not secure such listing by October 31, 2009 for any reason not solely attributable to Woori, Woori shall be entitled to exercise its put option to redeem the Debenture at the face value and shall also be entitled to receive from the Company the payment of interest on the outstanding principal balance of the Debenture calculated at the compounded rate of ten per cent per annum.
