Replies to post #24994 on China MediaExpress Holdings, Inc. (fka CCME)

[Traderfan]

That's a complete different situation. Did the CFO and the auditor resign at AUTC? Geez Joe.


AUTC canceled their earn-out shares and the stock doubled. And no, I'm not joking ..... when CCME resumes trading, I will make a ton

[researcher59]

CCME may only resume trading on the pinksheets the way RINO did ..... I don't think it will turn into another AUTC, although it's possible.

The big question is will Nasdaq allow trading to resume or will it be delisted and trade instead on the pinksheets ??????? Time will tell.

[saltvine_00]

The difference is that AUTC has an auditor. But I agree there is probably some value here depending on where it opens.

Maybe what happened here is a result of the incentive problem. Give management a net income target and a HUGE payout if that target gets hit then there is a very big incentive for dishonesty.

I think there is no doubt they operate a real business, now the question though is what do they really generate in revenues/earnings.

I guess there a few scenarios which are all plausible.

A) The company has planned this from the start where they operated a real business that was not that profitable. They partnered with various entities to boost ad revenues/profits on paper and then fake the bank accounts in order to sell their shares. Selling to starr would support this and reverse merger at low valuation. impressive they could fool dtt and starr if they did.

B) The company is somewhat legit. They operate far fewer buses than implied, (12,000) or so, but do have the contracts for 27,000 which they are slowly installing. They generate real income, perhaps even with good margins. They were not going to hit net income so maybe they did some fudging somewhere to get it. Airport buses is probably where they would do it as they are most profitable.

In this case hopefully cash is real and there is a profitable business. Earn outs would be canceled due to not hitting targets and potentially something is salvaged. If Starr didnt exit perhaps they could help facilitate a sale of the company/assets or maybe even get another auditor to think about trusting them after some new management is put in place.

C) DTT really didnt find anything significant but no longer trusts management due to cultural differences (dyp??). ccme is really a cash generating machine and a fantastic business that continues to grow. They get a new cfo and a new auditor and all is fine and dandy

D)...E)... combinations of the above, who know this is a mess.

I doubt its C with dtt leaving. Don't think its A on the other extreme and hopeful its a B type situation.