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  1. #61
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    In Annual report GE down to less than 1 % of shares
    EMC Management hold re 14.5 million shares plus options, they will be diluted to 66% too i guess. and happy to be so !!!?
    RWL you'd think would be a very profitable business with over 7000 installations( thanks Dark Horse )
    Although $60 million from 7000 =$8571 per installation average?

  2. #62
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    Hit 1$ then back down to 90c 2,382,000 shares through. Not the reaction of a transformational deal being done atp?

  3. #63
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    Interview with 3 Amigos from both companies.Impressive.
    http://www.peakassetmanagement.com.au/emc-2/

  4. #64
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    I am trying to get my head around the market reaction in light of this proposed transaction and the current valuation.

    We've seen a company that has fairly consistently been valued around the 70 - 80 cent mark continue to progress as planned with promising news flow (albeit not Chinese contracts), including obtaining EPA certification and forming strong partnerships in China. We have no indication that certification in China won't be obtained and not once have we seen this technology not deliver on its promises in any of its deployments or demonstration plants. EMC haven't yet gained traction via secured revenue in the Chinese market (and presumably the market is waiting for this as a seal of approval on the technology and proficiency of EMC) but the progress they have made has been very impressive. Either way, I feel confident that the tech and management of EMC are good enough to secure reasonable revenue in China and other markets, so we will just have to watch that play out. So a SP of 85 cents for EMC would seem an acceptable one, pre transaction.

    But then we add in the likely addition of RWL to the EMC business. Successful sales infrastructure and networks, complementary products, added expertise (particularly in offering containerized one stop shop solutions), very strong management (including ex GE CTO amongst others), and a business that is growing at over 30 percent p.a. and has forecast 90 mil US revenue for 17 (of which 70 percent is booked). Not to mention the backing of Lauder and an extremely sophisticated board that helped make the decision to merge with EMC (i.e. they back EMC and its tech/management).

    RWL is coming across debt free, for a price of around 85 million (I.e. bloody cheap!) and will generate a combined, revenue generating unit with a full water system offering and access to a number of markets. It's in one of the hottest industries of our future (water), and they are placing themselves not only in a multi billion dollar market (both the China rural development plan and wastewater in general) but also in a market where there isnt a huge deal of agile competition with an international reach - in terms of the 5 - 50m contract market.

    I appreciate there is still uncertainty around this transaction, who RWL is, and even EMC in general as to whether it can deliver. But surely, when you consider the basic multiples of revenue that should be at play, the growth potential of the two companies and the offering that it provides investors in the highly sought after water industry, this has to be an undervaluation at current prices? Perhaps instos are still waiting for assurance around the deal and a first contract in China…but to me it seems like very good buying atm. Interested to hear other views as to why this might be a fair price...

  5. #65
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    Quote Originally Posted by dela47 View Post
    I am trying to get my head around the market reaction in light of this proposed transaction and the current valuation.

    We've seen a company that has fairly consistently been valued around the 70 - 80 cent mark continue to progress as planned with promising news flow (albeit not Chinese contracts), including obtaining EPA certification and forming strong partnerships in China. We have no indication that certification in China won't be obtained and not once have we seen this technology not deliver on its promises in any of its deployments or demonstration plants. EMC haven't yet gained traction via secured revenue in the Chinese market (and presumably the market is waiting for this as a seal of approval on the technology and proficiency of EMC) but the progress they have made has been very impressive. Either way, I feel confident that the tech and management of EMC are good enough to secure reasonable revenue in China and other markets, so we will just have to watch that play out. So a SP of 85 cents for EMC would seem an acceptable one, pre transaction.

    But then we add in the likely addition of RWL to the EMC business. Successful sales infrastructure and networks, complementary products, added expertise (particularly in offering containerized one stop shop solutions), very strong management (including ex GE CTO amongst others), and a business that is growing at over 30 percent p.a. and has forecast 90 mil US revenue for 17 (of which 70 percent is booked). Not to mention the backing of Lauder and an extremely sophisticated board that helped make the decision to merge with EMC (i.e. they back EMC and its tech/management).

    RWL is coming across debt free, for a price of around 85 million (I.e. bloody cheap!) and will generate a combined, revenue generating unit with a full water system offering and access to a number of markets. It's in one of the hottest industries of our future (water), and they are placing themselves not only in a multi billion dollar market (both the China rural development plan and wastewater in general) but also in a market where there isnt a huge deal of agile competition with an international reach - in terms of the 5 - 50m contract market.

    I appreciate there is still uncertainty around this transaction, who RWL is, and even EMC in general as to whether it can deliver. But surely, when you consider the basic multiples of revenue that should be at play, the growth potential of the two companies and the offering that it provides investors in the highly sought after water industry, this has to be an undervaluation at current prices? Perhaps instos are still waiting for assurance around the deal and a first contract in China…but to me it seems like very good buying atm. Interested to hear other views as to why this might be a fair price...
    The market action is puzzling given the fundamentals behind this tie-up, or even behind EMC on its own. Presumably there are traders cashing in from lower levels and/or the bigger players awaiting confirmation before buying in. Nice to know that from now on the only way for anyone to get shares is to buy on-market as there will be no more capital raising.

  6. #66
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    Some good posts on here in the last few days. Thanks all.

    Like others, I find the SP action a bit mystifying. I have come to the conclusion that EMC is still stuck in a pre-RWL time warp. By that I mean all the talk then was about China, and perhaps the market still wants validation of that strategy (read multiple certifications and then orders) first.

    Take it as read that RWL don't need that validation - they have literally just put their money where their mouth is. I am going to pull some cash from the barking end of my portfolio and buy a few more EMC before things really hot up later in the year. Follow the smart money as they say.

  7. #67
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    Got a small handful more on the open, these prices seem too good to be true. I expect there needs to be a bit more certainty around the transaction and revenues before the market takes this more seriously, but by that time the price could be quite a lot higher, barring anything unforeseen. The potential is enormous, especially when you factor in the urgent and increasing global need for water + water treatment, the quality of the management team and the fact that the combined entity will be debt-free and not likely to capital raise in the future. And we're now less dependent on China on its own as the new Fluence will be a truly global player.

  8. #68
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    EMC Announces Planned First Commercial Deployment in China. Saying and doing all the right things; just don't like the over promotion myself.
    PDF

  9. #69
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    Quote Originally Posted by Joshuatree View Post
    EMC Announces Planned First Commercial Deployment in China. Saying and doing all the right things; just don't like the over promotion myself.
    PDF
    I wouldn't call this over-promotion, this is their first commercial deployment in China (not a demo plant) and so it is a very significant milestone. I'd call it over-promotion if they announced every single commercial sale from now on unless they were pioneering sales (first for new customer/region/product), but this one deserves a few bright lights on it.

  10. #70
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    Dropped as low as 82 today despite yesterday's news. Fair bit of fluctuation (or for the more emotive among us, manipulation) going on.

    Surely the prospects of the company are far more advance than they were months ago pre merger potential and China advancement. Can't see who'd be selling for a failure to deliver on expectations, when you can't have realistically asked for a whole lot more at this stage given the nature of the task they're tackling.

    Interesting to watch.

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