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Wow - I'll need a .50 increase just to breakeven on this!!!! Need to get some good PR out in a hurry or there may still be a long, long way to go before this bottoms out.
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Wow - I'll need a .50 increase just to breakeven on this!!!! Need to get some good PR out in a hurry or there may still be a long, long way to go before this bottoms out.
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Don't like the early action on this today. Looks like another big down day is ahead. Hate to say it but probably will drop to around 2.50 today. OUCH!!!!!!
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A little over 1 million shares in the first hour and holding on to a slight positive gain - maybe it'll be a better day that I thought.
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IN THE MONEY:Forget Dan Brown;Try 'The GlobeTel Code'>GTE
[ 2006-01-26 ]
By Maxwell Murphy, A Dow Jones Newswires Column
NEW YORK (Dow Jones)--At first glance, the world of GlobeTel Communications Corp. (GTE) appears akin to Dan Brown's blockbuster thriller "The DaVinci Code".
GlobeTel's a Florida-based company that, until now, has largely gleaned revenue from selling bundled telephone minutes. Dig a little deeper into GlobeTel's world, however, and you'll find a cast of global characters including a former astronaut, diplomats, Colombian President Alvaro Uribe, a firm founded by Henry Kissinger and a former CIA employee. There's even a member of the Knights of Malta, a millennia-old charitable Roman Catholic order some claim is as shadowy as Brown's puppeteering Priory of Sion.
But putting all this intrigue aside, GlobeTel's worth a look from the far less conspiratorial aspect of pure fundamentals.
GlobeTel, a former Bulletin Board shell company, has racked up more than $55 million in losses over the past several years. But it has aspirations to usher in a global wireless revolution, using a technology called WiMax it bought last year for nextto nothing, that it someday soon hopes to combine with its high- tech, blimp-like Stratellites (GlobeTel says "rigid dirigible" is more accurate than blimp).
The company says it just inked a deal with a group of Russian investors it says will land it a $150 million payment this month. There's another $450 million on top of that when it completes its wireless rollout in 30 major Russian cities over the next nine quarters, but GlobeTel says it's even more excited about the recurring revenue streams the deal promises than it is about the initial payment.
Though details are scant, $600 million would help convince its investors that GlobeTel's for real and prove wrong a growing throng of short sellers betting the hope is no more than hype. Short interest rose more than 32% from mid- December through mid-January, to more than 5.3 million shares sold short.
Neither shorts nor true believers have to wait long; GlobeTel Chief Executive Tim Huff says the $150 million is due in the next five days. A press conference in Russia with LLC Internafta, the foreign investors, will in February set the stage for network building in Moscow and Saint Petersburg beginning in April, he said.
GlobeTel's stock traded up slightly at $3.02 on the American Stock Exchange in Thursday midmorning trading, following a sharp drop Wednesday on heavy volume with no apparent news. Though it's off 33% from an all-time high earlier this month, it's still prodigiously above the roughly 15 cents it fetched just over a year ago. With more than 121 million fully diluted shares outstanding, GlobeTel has a market value above $360 million.
A successful Russian deployment - along with revenue from deals it says are in place in countries like Mexico, Colombia, Japan, China and Brazil - would justify that and then some.
If successful, tiny, unheralded GlobeTel will go down as one of the shrewdest acquirers in recent memory. GlobeTel paid only $2 million in stock just seven months ago when it bought HotZone Wireless. That deal gave it WiMax and other wireless technologies which GlobeTel hopes will deliver wireless telephony and broadband to Russia and other nations.
Put another way, the Russian deal is worth 300 times what the core technology cost GlobeTel.
Huff says HotZone, formerly a GlobeTel partner, sold the technology because it ran out of money, and he sees its acquisition as no more unusual or improbable than Microsoft paying $50,000 for an early version of the MS-DOS computer operating system.
Cynics have plenty of ammunition on GlobeTel: a history of losses, related party deals and lofty aspirations touted by a raft of press releases.
In 2002, Paul Taboada, an analyst with Hornblower & Weeks, was suspended and fined by National Association of Securities Dealers for "issuing a research report containing material misrepresentations and omissions" about GlobeTel back when it was called American Diversified Group. (His firm and two principals were also penalized). According to GlobeTel filings, Taboada consulted with the company for many years and is now an investor in a class of its preferred stock.
If GlobeTel's as full of hot air as the fleets of dirigibles the company sees as a cheaper alternative to satellites, some pretty big reputations are going to take a bath. Officers, directors and partners of the company include a former astronaut, Rick Searfoss, and a couple other well-respected employees of National Aeronautics and Space Administration that a NASA spokesman concedes GlobeTel was able to poach.
In September, it named former U.K. ambassador to the U.S., Sir Christopher Meyer, as its chairman. The distinguished statesman is currently chairman of the U.K. Press Complaints Commission and serves on the boards of several U.K. companies.
Then there's J. Randolph Dumas, a successful global businessman, Wharton graduate and, several biographical notes on him say, former national briefing officer for the CIA. The CIA doesn't confirm or deny employment or discuss companies, a spokeswoman said. Dumas was until recently employed by Rubikon Partners, a private equity firm he co-founded with Henry Kissinger, Leo A. Daly III, a third-generation architectural success and self-proclaimed Knight of Malta, and GlobeTel's most recent director, Dorian Klein.
The Uribe connection stems from a meeting with the Colombian leader and his cabinet last year over a potential $50 million deal, made with another company organized in Florida early last year, to float five Stratellites and set up a wireless network in the South American country. GlobeTel in July said it " received strong support for the project from several high ranking government officials including Colombian President, Alvaro Uribe," who GlobeTel officials said they met at his palace in Bogota and who was "very gracious and told ( GlobeTel) that he would help (it) in any way that he could to bring this technology to his country." A call to the Colombian embassy to the U.S. went unreturned.
GlobeTel's Sanswire unit wants to put fleets of these so-called Stratellites in the stratosphere, 65,000 feet over the Earth's surface. The Stratellites look like blimps, but GlobeTel is quick to remind they're a different breed of dirigible that hovers above the weather and can eliminate some of the signal delays and other problems experienced when transmitting to and from satellites in outer space. Since acquiring Sanswire in early 2004, GlobeTel has been developing and showcasing prototypes, and CEO Huff says a demo model will have a test run at Edwards Air Force Base next month with a working product ready in six to 12 months.
It also says deals with an Indian company, Financial Software & Systems, will be a huge success when GlobeTel's stored-value cards - a MasterCard that can also be used as a calling card and secure money-wiring-and-receiving device - hit the market in the coming months. With its new initiatives and a focus on the margins of its current business, Huff says debt-free GlobeTel sees break-even results for the current quarter.
Today's sales, growing rapidly as they may be, are designed more to boost GlobeTel's top line than its bottom. Right now, GlobeTel gets the vast majority of its revenue from selling wholesale international telephone minutes on its networks to a select few major telecommunications providers, and that business has the slimmest of gross margins. Huff says GlobeTel hopes to double that business, to about $200 million a year, and make it profitable, but the focus in coming quarters will be its other ventures.
Even Dan Brown's fictional protagonist, Harvard symbology professor Robert Langdon, might not be able to figure out whether GlobeTel's Russian wireless network will succeed. Until the story climaxes, expect GlobeTel investors on both sides of the fence to feel like they're reading a frenetically paced novel full of excruciatingly short chapters that each end with a cliffhanger.
(Maxwell Murphy is one of four "In the Money" columnists who take a sophisticated look at the value of companies, and their securities, and explore unique trading strategies.)
By Maxwell Murphy; Dow Jones Newswires; 201-938-5173; maxwell.murphy* dowjones.com
-------------------- It is impossible to make anything foolproof because fools are so ingenious.
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In plain english, what does this essay say or imply? Good or bad?
Shark
It's good IMO. Says if Globetel's deals and hard work come to fruition, future looks bright. I would refer you to these quotes from the article: "If successful, tiny, unheralded GlobeTel will go down as one of the shrewdest acquirers in recent memory. GlobeTel paid only $2 million in stock just seven months ago when it bought HotZone Wireless. That deal gave it WiMax and other wireless technologies which GlobeTel hopes will deliver wireless telephony and broadband to Russia and other nations."
"Put another way, the Russian deal is worth 300 times what the core technology cost GlobeTel."
"Huff says HotZone, formerly a GlobeTel partner, sold the technology because it ran out of money, and he sees its acquisition as no more unusual or improbable than Microsoft paying $50,000 for an early version of the MS-DOS computer operating system."
All GTE has to do now is perform, which is the way it should be IMO. GLTA!
-------------------- It is impossible to make anything foolproof because fools are so ingenious.
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<em>Neither shorts nor true believers have to wait long; GlobeTel Chief Executive Tim Huff says the $150 million is due in the next five days.</em>
I bet there will be a news release for this soon then.
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GLOBETEL COMMUNICATIONS CORP. RESPONDS TO ARTICLE BY MOTLEY FOOL’S SETH JAYSON
January 27, 2006, Fort Lauderdale, FL -- In accordance with the obligations placed on all Amex-listed companies under Rule 401(c) of the Rules of the American Stock Exchange, GlobeTel Communications Corp. (AMEX: GTE) would like to state in the strongest terms that the statements and implications made by Mr. Seth Jayson in his Motley Fool article dated January 23rd, 2006, are entirely without substance and are misleading. The Company rejects his attempts at guilt by association regarding persons and actions that predate any GlobeTel involvement with Advantage Telecom. GlobeTel believes his misleading statements result in damaging implications that have the potential to seriously damage both shareholder value and the ability of GTE management to effectively conduct the Company’s business.
-------------------- It is impossible to make anything foolproof because fools are so ingenious.
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I'm in the same boat as you, I need a .95 increase, just to break even now...
Shark
That sucks....hope you only have a few hundred invested. I thought about buying back in on that dip the other day but chickened out. If you look back to the last BIG downward trend before the contract.....this baby dropped very far. With the price cooling off a little, it make me wonder if its will drop to mid 2's again???
I don't own any GTE just to make this clear to everyone.
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GLOBETEL COMMUNICATIONS CORP. PROVIDES UPDATE ON FINANCING OF RUSSIAN WIRELESS JOINT VENTURE
Fort Lauderdale, Florida, January 31, 2006 -- GlobeTel Communications Corp. today announced that it has extended by 30 days the payment deadline for LLC Internafta to present its first payment so that lawyers and bankers for the parties may continue to work on structuring the payment to be in compliance with banking and currency transfer regulations in the United States and Europe.
GlobeTel CEO Timothy Huff stated: “This is a highly complex international transaction on which all sides continue to work together in good faith. There are numerous legal and regulatory issues that must be resolved and those steps require time and specialized expertise. GlobeTel is represented in Moscow by the law firm of Cleary Gottlieb Steen & Hamilton LLP.”
About GlobeTel Communications Corporation:
GlobeTel Communications Corp. is a diversified Telecommunications and Financial Services company. GlobeTel operates business units in stored value debit cards, as a certified financial transactions processor; the sale of carrier-grade VoIP of long distance to major long-distance re-sellers, VoIP technology, wireless radio technology and development, and high-altitude airship research and development. These self-contained business units were developed to operate independently of each other. The symbiotic relationship, however, provides value to each of the other business units. This strategy offers GlobeTel financial diversity and risk mitigation while striving toward its operating objectives.
Operating on a global basis, GlobeTel has historically focused its business development on markets outside of the United States. Current operations and business relationships exist in Asia, Europe, South America, Mexico and the Caribbean.
Cleary Gottlieb Steen & Hamilton LLP is a leading international law firm, with 12 closely integrated offices located in major financial centers around the world. For more than 50 years, the firm has been preeminent in shaping the globalization of the legal profession. Our worldwide practice has a proven track record for innovation and providing work of the highest quality to meet the domestic and international needs of our clients. In recognition of the firm's strong global practice, its effectiveness in dealing with the different business cultures of the countries in which it operates, and its success in multiple jurisdictions, Cleary Gottlieb received Chambers & Partners’ inaugural International Law Firm of the Year award.
Certain statements in this release constitute forward-looking statements or statements which may be deemed or construed to be forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. The words "forecast," "project," "intend," "expect" "should," "would," and similar expressions and all statements, which are not historical facts, are intended to identify forward-looking statements. These forward-looking statements involve and are subject to known and unknown risks, uncertainties and other factors which could cause the Company's actual results, performance (finance or operating) or achievements to differ from future results, performance (financing and operating) or achievements expressed or implied by such forward-looking statements. There can be no assurance that LLC Internafta will provide funding on a timely basis and there is substantial uncertainty with regard to the business and political climate when operating in the Russian Federation. Sanswire Networks and the launch of the Company's high-altitude airship are subject to various risk factors and investors should construe any such investment as speculative.. Certain of the above are more fully discussed in the Company's SEC filings.
-------------------- It is impossible to make anything foolproof because fools are so ingenious.
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Now I am even starting to wonder, first IN THE MONEY, then The Fool, now this....and I am a believer
News for 'GTE' - (=DJ GlobeTel Dn;'Numerous Legal And Regulatory Issues' To Fix)
By Maxwell Murphy
Of DOW JONES NEWSWIRES
NEW YORK (Dow Jones)--Shares of GlobeTel Communications Corp. (GTE) plunged abruptly in Tuesday trading when the Florida company said an initial $150 million payment from a Russian partner - which GlobeTel had said would arrive before Wednesday - will take up to 30 days longer than expected.
The deadline for LLC Internafta to make the payment has been extended by 30 days, GlobeTel said in a press release late Tuesday morning. Late last month, GlobeTel announced a group of Russian investors - about which there are scant details - would pay GlobeTel $600 million over the next nine quarters to install GlobeTel's HotZone WiMax wireless network in the 30 largest Russian cities.
GlobeTel, in its release, said the extra time is necessary "so that lawyers and bankers for the parties may continue to work on structuring the payment to be in compliance with banking and currency transfer regulations in the United States and Europe."
Timothy Huff, GlobeTel's chief executive, in the release called the deal a "highly complex international transaction on which all sides continue to work together in good faith," and said there are "numerous legal and regulatory issues that must be resolved and those steps require time and specialized expertise." Huff, who didn't return calls seeking further details, said GlobeTel's legal representation in Moscow is being handled by Cleary Gottlieb Steen & Hamilton, which couldn't immediately be reached for comment.
Last week, an "In The Money" column profiled GlobeTel, its sometimes dubious and always grandiose ambitions, and the big-name backers the company has, starting with Sir Christopher Meyer, the former U.K. ambassador to the U.S., who was named GlobeTel chairman in September.
In previous interviews, Huff told Dow Jones Newswires the $150 million would be in GlobeTel's hands by the end of January, to be followed by a joint February press conference with the Russian investors and the rollout of network construction in Moscow and other cities beginning in April.
GlobeTel has announced several deals all over the globe during the past year, with none yet leading to any material revenue. For example, in July it announced a $50 million deal with a new and unheralded Florida company to deploy over Colombia five of GlobeTel's Stratellites that would form the backbone of a wireless network in the South American country. GlobeTel even has the support, it says, of Colombian President Alvaro Uribe.
Stratellites are perhaps the most bodacious of GlobeTel's plans. They look like blimps, but are a different, rigid type of dirigible GlobeTel hopes to float in the stratosphere to provide a cheaper and better alternative to satellites. Several other companies, as well as the U.S. government, are looking into similar technologies for use in missile-defense-system, border-patrol, telecommunications and military applications.
American Stock Exchange-listed GlobeTel stock recently changed hands at $2.67, down 47 cents, or 15%, on heavier than usual volume of 5.5 million shares. The stock was off as much as 22% during the session.
-By Maxwell Murphy, Dow Jones Newswires; 201-938-5173; maxwell.murphy*dowjones.com
(END) Dow Jones Newswires
January 31, 2006 13:26 ET (18:26 GMT)
Copyright (c) 2006 Dow Jones & Company, Inc.- - 01 26 PM EST 01-31-06
Source: DJ Broad Tape
[ January 31, 2006, 13:54: Message edited by: George ]
-------------------- If all goes well then great, if not, make it work.
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