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Gold/Mining/Energy : Capital Alliance Group - CPT (CDNX) -- Ignore unavailable to you. Want to Upgrade?

To: keith massey who wrote (375)	5/9/2000 11:33:00 PM
From: keith massey	Read Replies (1) \| Respond to of 960

With the number of private placements, underwritings and IPO's being cancelled in the past 6 weeks it is a big vote of confidence, in my opinion, to see the institutions and insiders putting their own money on the line and closing the large majority of the Pre-IPO private placement. According to the news release they have received "Expression of Interest" letters from institutional investors that want to make investments in SEG at both the Pre-IPO level (and IPO level), above and beyond those announced in the last news release which is great news. Given current market conditions I am not surprised in the least to see delays in closing a Pre-IPO private placement of this size on the CNDX. I am sure the company debated the merits of keeping this private placement open until the entire $10 million U.S was received. However the company probably realized that some investor's imaginations would run wild and think that the entire private placement was in jeopardy and would be cancelled. In my opinion, it was a wise move on their part to announce the closing of the $10.8 million and move towards the IPO later this year. The company can now wait for the rest of the Pre-IPO money roll over in and announce as the money is received. According to my calculations the company to date has sold 16.5% of its equity interest in SEG for $10.88 million Cdn. This places a current value on SEG at $55.1 million Cdn. (((1-0.165)/0.165) * $10.88 million). CPT's 83.5% stake in SEG is worth approximately $44.2 million based on this valuation. Of course this valuation of SEG is based on the seed capital price and not the IPO price. If you use the IPO price to value SEG then CPT's holdings in SEG are worth several multiples of the above value. So we now have a company with 10 million shares outstanding, no debt, $15 million in the bank, an equity stake in SEG worth a bare minimum of $44 million, also holding their subsidiary CIBT which is the largest foreign MBA facilitator in China and is going into the online education industry. I think I just convinced myself to add some more to the pile. Best Regards KEITH