Trying to quantify FLM deal

[gaosl11]

OK, so our famous B friend on ST shared below article of RM in HK

http://www.scmp.com/business/money/marke...t-backdoor

excerpt from article:

Andrew Lam, director at accounting consultants BDO.

"A shell company listed on GEM could be easily fetched for HK$200 million, which is less than a luxury flat in Hong Kong and compared with HK$500 million on the main board,"

Considering it's a independent 3rd party i'll use his number, which is HK$500 million on the main board.

Also the article is more than half year ago, and Shanghai-HK stock exchange connect is open later and Tack Fiori is not elgible for short in HK main board, i think it's fair to give 10% premium which means it worth 550M.

Assuming NQ will own 62% share of new company according to previous calculation that means:

NQ used 38% FLM share in exchange for HK mainboard list(HKD 550M which is about $70 million) + 15 million from Bison and other party + 62% of original Tack Fiori Business (10 million).

That deal values whole FLM around 250M. In comparison, CMGE which is number 1 mobile game company in China is currently valued at 577M (SP around 18 now with 52 week range 12 ~ 40).

an artical from CMGE website shows mobile game market share in 2014Q2 which seems fair to say FLM is less than half of CMGE (CMGE: 19.3%, FLM 6.3%)

http://www.cmge.com/article/1520.html

Be aware 2014Q1 FLM has 10.3% market share and it's game industry so one game can change a lot of thing

[gaosl11]

I forgot to mention CMGE also has around 70 million cash. While detail of FLM is not disclosed yet, no idea how much money and debt will transfer together with FLM

[BillNeuburger]

I hate this deal so much, and so doesn't the market. There should be no other barometer aside from the market to tell management what to do. These guys just think they can outsmart the market, rather than pursuing alternatives or rebuilding trust first, which inevitably works in our favor if FL Mobile also increases in value. It needs to be terminated.

[gaosl11]

I hate this deal so much, and so doesn't the market. There should be no other barometer aside from the market to tell management what to do. These guys just think they can outsmart the market, rather than pursuing alternatives or rebuilding trust first, which inevitably works in our favor if FL Mobile also increases in value. It needs to be terminated.

I fully agree with you Bill. The top 1 priorty for NQ should be rebuild trust consider they lost CFO, CEO, chairman, auditor .... in one year.

[BillNeuburger]

I hate this deal so much, and so doesn't the market. There should be no other barometer aside from the market to tell management what to do. These guys just think they can outsmart the market, rather than pursuing alternatives or rebuilding trust first, which inevitably works in our favor if FL Mobile also increases in value. It needs to be terminated.

I fully agree with you Bill. The top 1 priorty for NQ should be rebuild trust consider they lost CFO, CEO, chairman, auditor .... in one year.

Exactly and that's why am trying to bring as much awareness as possible in order to pressure management into doing the right thing. It is not the time to create more skepticism. Either they do deals for hard cash or nothing!