As I understand it, Racom worked the mass transit sector through partners like Cubic, Bull, and others. For the most part they were focused on metro systems. To my knowledge, they were not in the NY turnpike contract. Racom phased out auto fare collection around the first of the year when they brought that hotshot in from Verifone. He concluded auto fare collection and smartcards were still five years away. Racom wrote a new business plan but couldn't find favorable financial terms.
Most of what Racom did was trials that cost more money than what came back and then failed to deliver these developed systems to other clients. On top of this, banks were slow to catch on to smartcards, standards, etc. and Racom was not heavy enough to push its own standards. Also, cost of FRAM was high relative to other solutions like EEPROM.
If you invested in Racom before 1999, then you were investing in a smartcard, auto fare collecting business. However that business is now dead.
Considering control of Racom was past to two venture capitalists for $170,000, I'd say it didn't have many assets. The $170,000 was probably used to pay down bills and salaries.
The two reverse splits on Racom, 1 for 5 and then 1 for 15 pretty well wiped out your holdings; eg, 1000 shrs were reduced to 13shrs. Like it or not you are now the proud owner of a Korean Realtor and you had no say in the process. Ah... American Capitalism!
Hopefully, Ramtron salvaged the RFID patent assigned to Racom, but you never know. Until they fess up, they deserve all the doubt they have created.
If you still want a play on auto fare collection, Ramtron is still in the game but they have terrible management. They should have been bounced long ago. In contrast, Cubic (CUB)is the big boy on the block and they stand to profit the most. The auto fare deals require huge companies to build out. Like EDS is a partner with Cubic on the London Tube. They were bidding the BART system in San Francisco, but the banks help screw things up with a one-card-do-all concept that nobody can agree on. |
