GEO Investing

A few GeoInvesting members have asked the GeoTeam for added perspective on the Exceed (NASDAQ:EDS) story.  We have identified a red flag that should not be uncommon to GeoInvesting readers.  Just as in our LTUS and CGPI investigations, we have some concerns about EDS and Land Use right fees it claims to have paid to the municipal government of Ruichang City, Jiangxi Province.

See our EDS commentary here.

In other Chinese company news…

Sgoco Group (NASDAQ:SGOC) shares are strong, maybe in anticipation of the closing of the sale of its assets mentioned in its November 16, 2011 announcement. Based on the press release, the deal is slated to be completed by the end of March and translates into a stock price of about $4.40 per share.

“The Company entered into an Agreement for Sale and Purchase (“SPA”) with the Buyer pursuant to which it sold all of the outstanding capital shares of Honesty Group (“Sale Shares”) for cash consideration of US$76 million. The transfer of the Sale Shares was effective on November 15, 2011. The cash consideration will be paid in installments over the next four months.  Payment of the cash consideration is secured by a pledge of the Sale Shares and the Group’s cash, accounts receivable and advances to suppliers.  In the event that the Buyer does not make the installment payments, SGOCO will have the right to take back ownership of the Sale Shares or force the Buyer to liquidate the Group’s cash, accounts receivable and advances to suppliers to have sufficient funds to make the payments to the Seller.”

While we can’t verify the transaction has taken place, our OTGDD has confirmed that SGOC does in fact own a big piece of land, which may justify the price of the SPA transaction on Nov. 16, 2011.  Based on the Nov. 16, 2011 announcement, SGOC should have already received a USD 76 million as cash consideration.   We are waiting for SGOC to issue an update regarding this transaction.

Regarding our GeoBargains and GeoSpecials…

Please go here for a comprehensive 2011 year-end review of select GeoBargains and GeoSpecials(password is GEOTEAM)