Glentel Inc GLNIF

RE: Business Division is why I sold

[Robert40]

In May 2005, Retail Division was successful in acquiring from Hartco Corporation, in Québec, its Cabtel Corporation retail chain of 49 mall stores operating under the banner La Cabine Téléphonique in Québec and The Telephone Booth in Alberta and Ontario. This network of stores had been in business for over 20 years and has operated in similar malls in Ontario and Alberta as Glentel’s WirelessWave stores. This acquisition enabled Glentel to enter the Québec retail market for the first time, with 14 mall stores. Glentel issued, on a private placement basis, 1,600,000 common shares of the Company, at a price of $5.50 per common share, for gross cash proceeds of $8,800,000

I agree with you that ordinary shareholders were not given rights to buy those shares and underwriters and friends who could afford $150,000 worth of shares  (lot sale) were benefited by this private placement. I know very clearly that you and I objected strongly at that time stating that borrowing money against assets or issuing rights to existing shareholders would be good move as share price was dragged down for 30 days prior to coming up with $5.50 price tag per share.  Anyway it was not for expansion of business centers but to expand retail stores as mentioned in first paragraph.
I agree with you that I will buy GLN once business center is sold or abandoned. I am surprised that they could not cut a deal with new spectrum entrants and am sure that they will miss the golden opportunity provided by federal government to relax rules for foreign companies interested in investing in Canadian wireless companies.Operational Loss of more than $100,000 per month for business centers this year too much for me to buy GLN  shares. I will also question the Goodwill writeoff for their recent acquisitions. One thing i don't understand that all companies they acquired were making money standalone. It is internal politics you call it correctly dead weight that is dragging it down. It is impossible for Skidmore's to get rid off existing VP and only Director who looks after their gold mine of Towers Network. Both have no basic technical education or previous experience to run the company . One is a speaker and other is a paper pusher. One use to run marethons and other sold cars before joining Glentel, I doubt if they even completed their schooling. Wireless systems are complex and they need technical/engineering expertise to analyse. I am waiting for both to retire in couple of years if Skidmore's want to keep them.