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Microcap & Penny Stocks : TSIG.com TIGI (formerly TSIG)

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To: gambler who started this subject	12/1/2000 9:18:58 AM
From: REW	Read Replies (2) of 44908

The removal of Reliant from the acquisition campaign of TSIG.com was a wise decision, imo, and concurred with by the home office. There are multiple reasons for the decision and they fell right into the reasons for my uneasiness. Message 14885484 Message 14554772 There was the immediate necessity to fund Reliant with up to $10 million. TSIG.com was not going to take funding at the existing stock price due to the excessive dilution. That meant Reliant was going to have to wait until the stock maintained a level that would give funding without acceptable dilution. We also save the acquisition share cost of probably around 20 million shares. Reliant's box sales are suffering just like all the rest of the box sellers. Note Gateway's warning along with others. Reliant's margins are very narrow. As noted in the link above, additional funding would have been necessary to raise this through internal factors. That is like buying margins which is putting money in the pie to bake and see if it comes out much later in a profitable manner. TSIG.com would have been required to prefund Reliant's projects with no assurance of the outcome. That is the nature of Reliant's business. A failed project is money gone to be tried to be made up on the next. Roix's objectives are to do projects that project forward with reasonable asurance of maintaining the desired 20% plus margins which Reliant showed no assurance of doing so and probably would not ever be able to attain due to the nature of their business. A question is when and how will the approx $1 million be repaid that TSIG.com has already put into Reliant? The nature of Reliant's industry gives them a very low PE. This would have been an additional anchor on the valuation of TSIG.com's stock. TSIG.com is advancing itself as an internet entity and the drag of owning a business with low valuations would not be an advantage. Their main contribution would have been, ino, one of placing revenue to give the company the look of a higher revenue company. The result would be to dilute the overall margin. There is a side note. An agreement still remains with Reliant. Their customer base information remains in TSIG.com's data base. Affinity makes contact for additional sales and will continue to do so if the agreement remains in place. The sale is split and Reliant is sent their cut. This is the cream and we still have it and I assume the desired margins to TSIG.com is in this agreement. This agrement and effort of Affinity could be what gave, or helped to give, Reliant their marginal profit report. Bruss's and Roix's decision stems from their desire to not dilute the shareholder further without good reason. Maybe there is a different tack to take that will enhance shareholder values. The new management,imo, made the right decision to elimate this acquisition that Gordon brought. The growth of Affinity and it's profit margin along with what is coming from other efforts indicate TSIG.com with possibly as much as $100,000/week that they can spend as they like. This is a freedom the company has not had before. The projects on the table show Affinity with the potential of 3-4 times their current revenue next year if things work out right with the margin staying intact. We should see evidence of how the company is coming together and what the clients and projects are very soon. My feel now is there is an approximate need for $15 million, down from $25 with the elimination of Reliant. To be adjusted if additional acquisitions show themselves. The immediate necessity may be in the range of $5 million but with some time before critical mass due to the excess cash over need coming in. Just my opinion and observations, Bob

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