As a friend of NBT, you know we've been watching and waiting for the 4G Broadband Mobility revolution. Now that it's finally upon us, I don't want ANYONE to be left behind when this sector -- and the best stocks within it...
How to Play the 4G Broadband Mobility Revolution
Very interesting operations update from George Alvarez, CEO of VelaTel Global Communications, Inc. (VELA) this morning.
1) Looks like Croatia/Montenegro is accelerating deployment and has secured $3M with "partners" for expansion. Who are the "partners"? We'll find out.
Alvarez's later statement gives clues for Balkans and all deals (like Lima, CASC/NGSN). Here's the key: the expansion in Peru via "JV relationship to facilitate cash flow requirements...and pretty much in every country". The Lima spectrum expansion sounds like another beneficiary of "the JV partner" cash.
2) As far as B2B network deals with NGSN and CASC... who is the "local partner" to finance local deployment? We will find that out as well. Also, funds already there will be used to acquire spectrum and then that cash to deploy network according to Alvarez.
3) VN Tech "is going extremely well" and "expect great things in a short period of time." Additional trials are due to government subsidies to carriers to deploy fuel cell back-up capacity and larger scope of deployment to replace old battery based back-ups.
According to Alvarez, their VN Tech subsidiary is in very good position for orders as one of the first to obtain approvals for these types of government sponsored subsidies. They are working with their main strategic partner ZTE to get POs from incumbent carriers to replace a large percentage of existing back-up systems. VN Tech is an OEM supplier for ZTE on these back-up systems...at $7500 to $15000+ per system (depending on size of tower).
4) Zapna - more news expected in September...other deals to follow that are "very impressive."
Bottom-line--our next report on VELA is about reasonable valuations for the non-carrier assets...B2B 4G networks in China (CASC and NGSN), VN Tech the fuel cell back-up subsidiary in China, and Zapna (worldwide discount mobile voice and data roaming services).
The BIG surprise looks like A) VELA has found the JV strategic investor they need--is it China Mobile and B) the non-carrier assets look to add significant revenue and cash flows over the next 12-months.
Surprises to the upside for VELA? George Alvarez has been trying to sell 24% minority interests in his 4G TD-LTE carriers for a while...and China Mobile IS the most strategic investor out there with $50 billion of cash in the bank.
We all are so emotionally wounded with this stock no one will believe anything until the cash is in the bank account.
But the announcements this week are heading VELA in the right direction.
With $80-$170 million in 4G spectrum assets alone....and $1 million market cap...I don't think there is a more under-valued stock in our universe.
Disclaimer: NBT is long VELA shares
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Founder and Editor-in-Chief for NBTEquitiesResearch.com. Contributor and Anchor for the Fox News Channel and Fox Business Network 2000-2013. Chairman & CEO of NBT Group, Inc., a boutique private capital investment bank and investor relations organization.
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