I hate AMEX stocks but this thing just popped. I heard a rumor that their deal with Russia is going to be alot bigger than expected. Anyone know anything about this stock?
IN THE MONEYact Delay May Be Twice As Good For GlobeTel Feb 9 at 13:39 Profile hits: QU5 By Maxwell Murphy, A Dow Jones Newswires Column NEW YORK (Dow Jones)--GlobeTel Communications Corp. (GTE) may just turn "worse than expected" into "better than imagined" after all. Recently, a delay in a $150 million initial payment from a wireless deal with Russian investors sent shares sharply south. But the Russians told Dow Jones Newswires their commitment to GlobeTel could make the delay doubly lucrative for the Florida-based company. Displeasure with the hold-up, coupled with confidence in both GlobeTel and a swift resolution, has caused the Russian investors to bump the first scheduled payment to $300 million, or half the face value of the wireless-network pact GlobeTel announced in December, the company and one of the Russian investors told Dow Jones Newswires Thursday. An 'In The Money' column in January profiled the GlobeTel saga and highlighted the risks and potential rewards attached to it, its stock and the Russian wireless pact. GlobeTel was due to receive $150 million, the first of several payments totaling $600 million, by Jan. 31, but that same day the company instead told investors via a press release that receipt of the money would be delayed up to 30 days. GlobeTel Chief Executive Timothy Huff blamed some technical regulatory issues regarding the transfer of funds. Maxim Chernizov, the only named principal of LLC Internafta, the Russian company set up to do business with GlobeTel, echoed Huff's view during the interview with Dow Jones Newswires Thursday, saying the delay was caused solely by the efforts of regulatory agencies to make sure the funds weren't being laundered and the transaction passes all the requisite international "sniff" tests. The $300 million, along with the rest of necessary funds, are in banks like Banco Do Brasil waiting to be released to GlobeTel's European operations, Chernizov said from Moscow in a telephone interview. The interview was conducted using a third-party translator on a conference call set up by GlobeTel. Chernizov, who describes himself as a businessman who made his fortune in rare earth metals, declined to name the other Internafta principals until the wireless venture becomes official and begins commercial operations, but he says none of the money he and his partners bring to the table is in any way associated with oligarchs, politicians or anyone else who would raise flags. Chernizov says Internafta isn't worried about competition from established Russian players because GlobeTel's network will work with wireless networks already in place but also brings new technology to improve the depth and breadth of telephony and other wireless services, as well as increase the size of the regions blanketed by coverage. He says he has already received firm interest from affiliates of Russian oil giant Gazprom OAO - where Chernizov says he used to work - who would much prefer to use Internafta's WiMax services than the spotty satellite phones that are the standard in Russia's barren Northern regions. The fact that he and most of his partners have no background in telecommunications doesn't shake Chernizov's confidence in the least. Internafta's aggressive plans call for 10 million or more subscribers in the first three years of service, which would create an enormous recurring revenue stream which Internafta and GlobeTel would split down the middle. Spokesmen for established players in the Russian wireless arena, like Vimpel Communications ( VIMP.RS), couldn't immediately be reached for comment on the state of that industry in Russia or the competitive threat a newcomer like Internafta might pose. GlobeTel's highly speculative stock has done a yo-yo on the American Stock Exchange for months as the former Bulletin Board company has announced ambitious deals for its WiMax wireless networks and other emerging technologies, deals that have yet to pay dividends. It sports a huge shareholder base, many of whom are rabidly loyal. As you might guess, it also has its share of cynics among both investors and the fourth estate. A growing throng of short sellers is betting against the company, and almost 5.4 million of its more than 121 million fully diluted shares outstanding were sold short as of the middle of last month. Even though trading at $2.58 a share at last glance, some of its strength sapped by the delay announcement a couple of weeks ago, GlobeTel's market value tops $300 million; however, that is a number the Russian money would likely justify and then some. Critics point to a raft of glowing press releases about global deals that have yet to generate revenue. They poke fun at GlobeTel's vision of fleets of airships - blimp-like Stratellites - which the company claims will eventually eliminate the need for cellular phone towers and provide a cheaper, more effective and easier alternative to satellites. Critics also say GlobeTel's current business, growing rapidly though it is, is nothing more than an unprofitable attempt at the simple business of bundling and reselling wholesale overseas long-distance minutes to major telephone service carriers. Another business for which GlobeTel has high hopes is a sort-of Mastercard-phone card combo, being tried out in places like India, that allows secure international wire transfers of funds among individuals. But GlobeTel is also surrounded by respected people of pedigree, including engineers from the National Aeronautics and Space Administration and a decorated former astronaut. In September, it named as chairman Sir Christopher Meyer, the distinguished former U.K. ambassador to the U.S., and it counts among its supporters successful businessmen like J. Randolph Dumas, a Wharton business school graduate and former national briefing officer for the Central Intelligence Agency, and Leo A. Daly III, the third-generation head of the eponymous global architectural and engineering firm. Dumas, Daly and recently named GlobeTel director Dorian Klein helped form international venture capital group Rubikon Partners with noted American political figure Henry Kissinger. CEO Huff admits the company hasn't proven itself yet, and welcomes the skepticism. He says in the near future it will become obvious whether or not GlobeTel is for real. Major progress toward a bright and profitable future will be clear this quarter, he says, with "substantial gains" in all the company's businesses. By the third quarter, GlobeTel's success should be a "foregone conclusion", he said, and the fourth quarter will be "the cherry on top." If not, expect someone other than Huff to go down with the ship, because Huff says if GlobeTel "isn't being called a success by December 2006, [he] will no longer be its CEO". (Maxwell Murphy is one of four "In the Money" columnists who take a sophisticated look at the value of companies, and their securities, and explore unique trading strategies.) -By Maxwell Murphy, Dow Jones Newswires;
GTE showing some life today. Anyone see any news about this Russian contract? Not to excited about the continued delay.