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>December 7, 1998
>
>
>
>StockNetworking News No. 10 (SNN)
>
>NEW PROFILE:
>
>COMGEN CORPORATION
>
>Symbol: CGEE
>
>Trades: OTC - BB
>
>Closing price Friday Dec 4: $ 5.50
>
>Phone: 1-877-608-1611
>
>
>
>SNN has a new Profile for our subscribers to review and
>evaluate - COMGEN CORP.
>
>We feel this company has a strong business plan in the
>environmental technology business.
>
>THE BUSINESS:
>
>COMGEN has developed a highly efficient process for
>converting waste oils, of all types, into diesel fuel. The
>importance of finding an economical solution to the problem
>of waste oil cannot be over emphasized because of the
>devastating impact oil can have on the fresh water supply.
>One gallon of oil can pollute 1,000,000 gallons of fresh water
>and 25% of waste oil being generated into the world
>today is now being illegally dumped into the environment.
>
>The principals of the company have refined this technology
>over the past 15 years to the point that they can economically
>operate their system and show a profit, without government
>subsidies or grants. In the past this type of technology could
>only be profitable with government assistance which usually
>took the form of tax breaks or outright grants. This has been
>the case in almost all areas of recycling to date.
>
>BUSINESS STRATEGY:
>
>Dr. Roy Jefferies and Mr. Peter Rzazewski, the companies
>co-founders, have vended the rights to exploit this technology
>into a US public company, COMGEN CORP.
>
>Their purpose in going public now is to raise capital, which will
>allow them to expand sales of the COMGEN technology, but
>also to allow COMGEN to participate in Joint Ventures of the
>operating side of the business.
>
>Rather than simply selling, installing and servicing these
>operations they want to participate in the downstream cash
>flow and profits which they have seen their customers enjoy.
>In this way they hope to gain a form of royalty from the
>technology.
>
>As an example, in Poland they have seen their primary
>customer go from a one man operation, with limited
>resources (as a result of which they virtually financed him
>into his first operation) to a position today where he has
>eight installations throughout Poland and he recently
>chartered a jet to take 42 of his key employees for a one
>week all expense paid vacation in Cyprus.
>
>A significant portion of the equity that COMGEN will put
>into each Joint Venture will come from their profit margin
>on equipment sales.
>
>The Joint Venture strategy is important because it will provide
>a number of strengths to the enterprise:
>
> The operating partner will be "hands on" at the local level
> and they will have a significant financial investment to
> protect.
>
> The J.V. partner will have local access to feedstock
> (used oil) for the plant.
>
> They will have a collection system in the form of a truck
> fleet and storage facilities for the used oil, and ideally,
> they will have sufficient additional zoned land to construct
> the COMGEN refining system.
>
>The playback on COMGEN's investment in these J.V.'s is
>projected to be between 2-5 years depending on the amount
>of government subsidization (if any) that is available.
>
>SIZE OF MARKET:
>
>Messrs. Rzazewski and Jefferies have been involved in the
>installation of 70 of these plants worldwide.
>
>Over the past three years they have sold, manufactured and
>installed 19 plants in Europe, the Middle East, Asia and
>Australia.
>
>They have not touched the environmentally sensitive markets
>in North America or Western Europe.
>
>The US generates 1.5 Billion gallons of waste oil each year
>and it would take over 600 systems to recycle this oil alone.
>Discussions have commenced with various parties in regard
>to developing this market.
>
>COMGEN also has written expressions of interest from
>multi-national corporations in the Middle East/India market
>and Asia, in regard to both manufacturing and operating
>these systems on a Joint Venture basis. As these
>discussions progress we will update our subscribers.
>
>There are other opportunities that are being developed in
>the area of co-generation of electricity from diesel powered
>generators.
>
>
>
>SUMMARY:
>
>This is a brand new company with a proven technology that
>is poised to grow rapidly.
>
>The stock has performed extremely positively to date, no
>doubt as a result of the rumors of this impending deal.
>
>Although this can be a slow time in the market, it may provide
>an opportunity to pick up the stock prior to the January -
>February period which traditionally sees some of the largest
>upside moves of the year.
>
>SNN strongly recommends that you keep COMGEN CORP.
>(Symbol: CGEE) on watch, as we expect some major
>announcements from the company in the near future.
>
>If you have any questions regarding Comgen or would like
>further information e-mailed to you please call the company
>at: 1-877-608-1611 |
