Cavico is a real company, but I share your concerns about their priorities. I'm sure WSM knows this company better than me, but I've been doing a lot of "catch up" DD this week as well.
"Scam" is a strong word, I don't think I'd use it. I do think the actual Cavico people on the ground are pretty clueless about US capital markets which is pretty typical for these overseas reverse merger companies. This leaves the shareholders vulnerable to people who want to do nothing but print out shares for equity financing and their own gain. To the overseas companies it sounds like a good deal, shoot, no more bank loans? No paying cash for financing anymore? I'm not suprised they always jump at it. Not trusting Henry or anything he touches too much either...turns out he was dragged in front of the US senate a while ago to testify about his misdeeds regarding a day-trading scam he ran in the late 90s. Since then, he has become a faithful Republican campaign contributor and thus has stayed out of trouble. Not liking him too much at all right now...
As far as having any "say" in this company, I can assure you we do not. But that's not atypical either. These overseas co.'s, esp in China and the like, do not have to abide by US securities laws and can promise the world and just walk away without repercussions at any time, and even list on another non-US exchange. (its happened before). I was just talking to someone about this and he said its: "Like buying a ticket to a carnival sideshow, knowing that the exhibits are fakes, but somehow not caring, and having a good time pretending otherwise. "
Its perception, not reality, that counts. Shareholders of Blackstone BX also have absolutely zero say the way the shares are structured also, but the perception of owning the company is what moves the price up or down. No matter how many shares Carl Icahn buys of BX, he could not do squat.
Same thing with these reverse merger shell companies. But that doesn't mean the price can't follow a path as if our shares really were ownership.
So I'm not really worried about having any "say" or "real ownership" in the company...What I am worried about is how much equity financing they are going to get and when, and are they serious about uplisting or are they just going to use promises of it to string investors along, like GTEC (another CCG client) did? The price of shares is determined by supply and demand, and its been heavy on the supply side for a while now. Will this last? Who knows.. Also, frankly, it will be hard to uplist with so many shares, and with no independant board members yet that a senior exchange would require.
My two cents for what it worth is to consider CVIC a very speculative buy for now. I will continue to buy shares, but cautiously. I'm not seeing a reversal in the downward spiral yet. They've put out some great news but the shares just keep on coming.
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