RE: Expect a "sharp sell-off" — Cleland
FYI, here's what Cleland said, so you can take it in context. The decline is strictly for valuation levels. I wonder if he's setting himself up for stellar 2010 numbers, since there's little/nothing he can do for 2009. Gotta get that reputation polished back up, and valuations as far as the books at Northern Rivers are something he DOES have some control over....:)
G7
3) Vendtek Systems
VSI is an odd and extremely frustrating situation because (according to public statements) the
business has performed well (during the course of the worst financial and economic conditions
since the Great Depression). Yet, because the stock has been halted since late January of 2009, we
are carrying it at approximately half the price at which it closed on December 31, 2008.
The bottom line is that despite the market turnaround in the latter three quarters of 2009 (which
saw many stocks up materially from their December 31, 2008 levels) we marked Vendtek at a
price representing a decline of almost 50% in 2009. Of course, this means that TWO of our
largest positions (Webtech and Vendtek) were down on the year. You can imagine my frustration,
especially when the Vendtek situation seems in many ways unrelated to the health of the
underlying business.
The point is that neither the dramatic turnaround in the markets nor the strong business
fundamentals of Vendtek have had a chance to reflect themselves in the price of Vendtek. I
expect they will over the course of 2010, after an initial sharp sell-off when the stock resumes
trading. I look forward to being able to discuss Vendtek in a lot more detail once the financial and
business development disclosures are made sometime in the near future.