Layups Long Holds

[Sims84]

PELE! (Pro Elite)..Guaranteed cash cow!


The resurrected ProElite (PELE.PK) looks ready to break onto the stock market scene like few stocks have in recent history. Recently, ProElite has been almost impossible to trade due to a “hold” on trading by the Depository Trust Company (DTC) whose mission is "to provide an efficient and safe way for buyers and sellers of securities to make their exchange, and thus "clear and settle" transactions". The hold was the result of some alleged wrongdoing by some individuals on the fringes of involvement with the company several years ago before the current management took over. It appears that the DTC is about to release it's grip on the stock and ProElite will once again be able to trade freely. 

The stock has a float of around 59 million which is fairly tightly held as evidenced by the quick run up in March when information surfaced that the company had been making offers to purchase Strikeforce. At that time, the stock jumped from .01 per share to more then .20 per share in two days based on the news that ProElite had reportedly made a bid for Strikeforce worth around $40 million. This seemed to be the catalyst that forced the UFC/Zuffa to act by outbidding ProElite and ultimately taking the rival organization under their wing. 

Since the UFC is privately held, ProElite is the only serious publicly held investment for those wanting to invest in the worlds fastest growing sport of mixed martial arts (MMA). There are other stocks that are currently on the fringes of involvement with MMA, but PELE is the only serious opportunity for fans and investors to get a piece of a real MMA organization. 

Stratus Media (SMDI.OB),the parent company of ProElite, is well stocked with individuals ready to move the company back to its once prominent position in the sport. They have key individuals in positions that have worked with major media outlets worldwide, and with the recent announcements of Rich Chou and T Jay Thompson being added to the mix, they now have some highly regarded MMA insiders as part of the team. 

In several interviews lately, Thompson has indicated that “ProElite 2.0” as he refers to the new incarnation of the company, is determined to not make the mistakes of the “old” company. He has often mentioned that the new company will be run “lean and mean” with out the excessive spending and questionable decision making that helped bring down the old company. 

The first event for the revived ProElite will be August 27 in Hawaii and will reportedly feature former UFC heavyweight champion Andre Arlovski along with notables and former UFC fighters Kendall Grove, Joe Riggs and Drew McFedries. Thompson has also stated he wants to feature a mix of established fighters and up and comers. Among the up and comers rumored for the card are the pro debut of NCAA wrestling champion Mark Ellis, female Olympic wrestling silver medalist Sara McMann, and the pro debut of Reagan Penn the brother of UFC superstar BJ Penn. 

Back in '07 under the old owners, PELE stock reached as high as $15 a share despite the huge debt and mismanagement of the old leadership. Even after the Kimbo Slice debacle, the stock held the $2 to $5 range until rumors of bankruptcy surfaced. The company never filed BK and once the company had parted ways with the likes of Gary Shaw and company, Chuck Champion (the remaining principal in the company) was able to work deals to clear the books of the massive debt the old management had run up. 

Fast forward to now and we have a revived, debt free company that is determined to not make the same mistakes. The company has retained the ProElite and EliteXC brands along with Cage Rage, Icon Sports, and Spirit MC. Speculation has it that the company has been sitting on news that will be released as soon as the DTC releases its hold. The company has already indicated the first event will stream live and free on Sherdog.com and that a TV deal will likely be in place for the second event, some time in November. The company has also expressed a desire to uplist the stock to a higher exchange at some point in the future. The announcement of the complete fight card for the August event will be made in the next few days. Also there will be the launch of the new ProElite website. 

It is unclear exactly when the DTC release will be final. There have been reports that the release has actually already happened and the wait now is for administrative matters to be finalized and announced before the stock can be traded freely. 

Expectations are that the stock price should reach levels comparable to a similar point in time when the original stock was established which would place the stock price as high as $2 share. Back then, the stock price continued to climb as each new event was announced and investors are looking for the same price appreciation this time around. If that proves to be the case, it would indicated a huge buying opportunity at the current price of .325 (as of 7.22.2011). If expectations become reality, this could make many happy investors in the days to come as the company grows along with the sport. 

Of course as always, I recommend that everyone do their due diligence on this and any other stock. 

http://www.investinmma.com/proelite-stock-ready-for-a-comeback/