Medtech Global Limited ("MDG') – Kiwi health care!

[steve fleming]

Heathcare software services provider

On track for its first full year profit, thanks to some big wins by its dominant NZ subsidiary.

A $7M contract with NZ Post and a $2m NZ E-therapy contract have been won in the last 6 months.

MDS is 75% owned by Cereus Holdings Ltd – a long time Auckand property developer with large Viaduct property holdings;

Solidly EBITDA and operating CF positive, and should deliver its first NPAT profit to March (it has a NZ reporting date) driven by the two afore-mentioned contracts.

m/c of $6m with 100m shares on issue, but is very illiquid.

[DTB]

very illiquid would be an understatement - $16 of shares up for grabs...! wtf?

[steve fleming]

very illiquid would be an understatement - $16 of shares up for grabs...! wtf?

Yep, but there is usually ways round market liquidity.

If anyone is interested in getting a reasonable stake (say $20k plus) in an illiquid company give the company, or in this case Cereus in NZ a call, often they are able to match you with a seller, or sort something out.

Cereus may even want to sell down themselves.

[drillfix]

MDS is 75% owned by Cereus Holdings Ltd – a long time Auckand property developer with large Viaduct property holdings;


m/c of $6m with 100m shares on issue, but is very illiquid.


Steve, I thought MDS was Midas Resources, which is a Terry Streeter play.

Or am I mixing up exchanges or something or private companies.

And yeah your not wrong about the stock being held, no body wants to sell, and nobody wants to step up either.

In your honest view Steve, what do you believe these shares, could, would or should be worth?

[evilroyrule]

Yep, but there is usually ways round market liquidity.

If anyone is interested in getting a reasonable stake (say $20k plus) in an illiquid company give the company, or in this case Cereus in NZ a call, often they are able to match you with a seller, or sort something out.

Cereus may even want to sell down themselves.

now thats worth remembering. cheers

[steve fleming]

Steve, I thought MDS was Midas Resources, which is a Terry Streeter play.

Or am I mixing up exchanges or something or private companies.

And yeah your not wrong about the stock being held, no body wants to sell, and nobody wants to step up either.

In your honest view Steve, what do you believe these shares, could, would or should be worth?

Hi Drilly - you are right, I meant MDG not MDS.

In terms of value, it will depend on what they do in the second half of the year.

Say they can do $1.5m EBITDA for FY11 (did $650k in the first half, and they have indicated a stronger second half), then say at a multiple of 8 gives an EV of 12 million. There is no material interst bearing debt, so thats pretty much your equity. 100m shares on issue gives you a theoretical value of 12c.

Having such a major shareholder and minimal liquidity is always going to impact pricing though.