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Microcap & Penny Stocks : SETO Semicon Tools Inc. -- Ignore unavailable to you. Want to Upgrade?

To: FRANK J CATALANO who wrote (3170)	9/19/2000 1:55:05 PM
From: James Lee Baldwin	Read Replies (1) \| Respond to of 3222

SETO Establishes Presence in Emerging Markets By Peter Lim Published by OTCNN.com 09/19/2000 11:25 AM EST SETO Holdings, Inc. (OTCBB: SETO) has been carving inroads into the third world and emerging economies with its products. Over the last week, the company announced the launching of its multi-media set top box through Pineapple Computer Superstores in major cities in Malaysia and the signing of a memorandum of understanding with WORLTRADE PNT Sdn Bhd as the exclusive distributor of the SETO telecommunications product line in India. Based in Briar Manor, NY, the company also expects to establish a presence in Latin America by the end of the year. SETO operates as a broad based technical manufacturer in three major product groupings: technical products to industry, inclusive of diamond tools, wafer fab supplies and technical ceramics; and consumer products such as cellular phone batteries, rechargeable batteries for use in consumer electronics and telecommunication devices. Formerly solely a contract manufacturer, SETO recently began developing and marketing its own brand name and owns manufacturing subsidiaries in Malaysia, China and Hong Kong. “It seemed logical to reduce shipping costs,” said SETO public relations manager Thomas Fisher of the company’s strategy to introduce its product line to emerging markets first. “Why take on the US marketplace at this point with an unknown brand name? And again, our manufacturing is over there so this seemed synergistic and logical. We’ve had manufacturing in Malaysia since 1989.” In April, SETO received a $1-million credit line from Merrill Lynch. The company has $3.7 million more than is required for a NASDAQ listing, but its stock price remains at about a third of the initial four-dollar mark required by the exchange. Although recently applied for a listing on the AMEX, for which the initial required stock price is $3.00, Fisher said doing a reverse split on the stock to achieve a higher price would not be in the shareholders’ best interest at this time, especially with a price-to-sales ratio of about one. *(in an earlier edition of OTCNN today, it was reported that SETO had been accepted by AMEX, when in fact, the company had only applied, but had not yet been accepted). The company has 19.3 million shares outstanding and 8.4 million shares in the float. So if it were to reverse split the stock four for one to achieve a NASDAQ listing, it would go to 5 million shares outstanding with and a float of only 2 million shares. The company feels that it would be difficult to obtain institutional interest at that point. “Any brokerage firm, for example, wouldn’t want to pick us up. They’d dominate and control the stock if they came into it,” says Fisher. “We’ve never seen a reverse stock split that resulted in anything positive for shareholders. Usually you reverse split a stock and it ends up over the course of 130 days to six months back at where it started only less shares outstanding.” A fully reporting company since 1987, Fisher says that SETO is a “real company with real assets.” The company’s roster of clients includes Sony (NYSE: SNE), Phillips (NYSE: PHG), Sharp Roxy, Asia Technologies, General Motors (NYSE: GM) and IBM (NYSE: IBM). He also added that SETO had entered into a non-disclosure agreement with Lucent Technologies (NYSE: LU) earlier this month. A recently released quarterly report revealed a 642 percent increase in revenue for the first six months of 2000 compared to the same period last year. Income from operations and net income were also up, 299 percent and 230 percent respectively. Shareholders equity for the six months ended July 31, 2000 increased 1.5 % to $7,865,698 as compared to $ 7,754,828 first quarter ending April 30, 2000 and an increase of 425% from $1,498,837 as compared to the six months ended July 31, 1999. The company is predicting $40 million in sales and $2 million in earnings this year, Fisher said. Despite its seemingly promising financial disposition, the company remains caught “between a rock and a hard place” as far as attracting the right type of investors it desires, Fisher said. Institutional investors tend to shy away from companies with small market caps like SETO, he added, and day traders often try to make a quick buck rather than sticking with stocks like SETO. For now at least, a reverse split seems to be out of the question. “As much as we long for a NASDAQ listing – it would allow us to grow much faster because the cost of funding would become significantly less –you destroy the people who have invested in your company by doing that (reverse split). We just don’t think that that’s a fair way to reward them.” Disclaimer OTC News Network is an unbiased, objective news source focusing exclusively on OTC Bulletin Board companies. We do NOT publish any paid editorial content. In addition, OTC News Network does NOT own any stock in any OTC Bulletin Board companies. None of the shareholders, officers and affiliated entities owns any stock in the companies mentioned in this article. This ensures that OTCNN can make its editorial decisions objectively. Companies included in the news stories have NOT paid a fee or any other form of compensation for their appearance. otcnn.com