Sino Agro Food Inc (fka SIAF)

[finvestor]

Looking over the CeresTM Presentation...What's That Plan?

Some things stand out:
1. The mega farm is clearly being discussed the first half of the presentaion ... but we know that is a SIAF/CA project.
2. The second half of the presentation is clearly the Kubo business from Europe.
[url][/url][tag]http://www.kubo.nl/en/[/tag] and their Ultra Clime system.
3. The CTM 'business' will be incorporated in Hong Kong...according to the presentation.

So speculating away:
1. CA / Kubo form a new company to access each others market (Chine/Europe) to jointly market and install green sustainable and climate durable crop and critter growing systems. This is the kind of 'Big Picture' thinking I would expect of Solomon. I just don't know how it all would fit together ,, is this a JV? Are we making the business to complicated again. Or do these two spin-off as a new and separate business?
2. Perhaps this CTM JV is from the relationship with ECAB or perhaps through seeking help for HU. (HU keeps failing do to rains and we hear more and more about climate change affecting local weather and crops...perhaps a deal for the first Chinese Ultra Clime system installation is waiting to be announced for the HU farm?)
3. From the PR it seems clear that SJAP, HU and the cattle farm will be spun off in some manner and that that plan is the focus of the conference call on the 17th ... but a word on listing then will be expected by the market and if not included will be a disappointment.
4. The new company after spinoffs might included
CeresTM - The new CA
Distribution Centers
Mega-Farm (and PFs and FFs)
5. So SIAF would have three pieces
A. CTM builds greenhouses, prawn farms and, perhaps abattoirs, worldwide
B. Mega-farm continues to build out the world largest aquaculture facility and sells its products.
C Warehouse distributions centers continue to sell domestic and imported products to China's biggest markets.
6. If this is what SIAF is going to look like this stock is worth way more than the existing business...it will grow faster, be more profitable, and be following three mega-trends (1. Chinese middle class growth and food trends, 2. aquaculture, and 3. green sustainable and climate durable food production)
7. If I take the CeresTM projections or RD's...I've got to see this as a 3 figure stock in 18-36 months. And that makes those of us from RHI very excited.


Questions bouncing around in my mind:
1. FD was always going to be on the board - we knew that back on Sept 4th of last year - it was in the bond agreement.
2. What would a fair valuation of the SJAP, HU and Cattle farm be and how would it be achieved?
3. However that spinoff plays out SIAF would want the production of those businesses to be tied to our Distribution Centers.
4, Will we maintain any kind of ownership share of the spinoff? I would suggest no because it would complicate our business story while we need to simplify it.
5. The thinking here seems to be that part of the proceeds would be paid as a special dividend but I challenge that ... we can use a lot of cash to either accelerate our 'behind schedule' Mega-Farm or to buy a greater share in it or the other aqua-businesses.
6. This spinoff might take longer than planned. The SOE merger previously proposed and rejected will enter into this somehow and take longer than now envisioned. I hope this is not true but the PRC SOE's are very influential and can complicate this whether we want it to or not.
Finn