Strange how the world goes. As an analyst I’m supposed to know my industry, report the facts of my targets, inform, and
present finished literary sculptures that put industry executives in a position to appreciate the on-goings behind the doors
of their competitors before they get hit on the head with a launch they are wholly unprepared to face.
Well, that suits traders and investors just fine. My articles which tend to be read by 20,000 industry executives now have a
readership of several hundred thousand, many of which are actual short term investors or traders who pick my articles for the
unintentional hint of a trading profit. I must say, that most have done quite well, with the stock rising from 5 cents to 50
cents only to take massive hits from huge profit taking – and it seems from a “rumor” that has at least one investor
concerned.
His Email went as follows : “I have heard that Falken was in talks with a company called Sponge-Tech (SPNGE). This company is
currently under SEC investigation and I am concerned about my investment. I don't want to be scammed.”
Well now, I would venture to say that little in the Automobile After-Market Industry would lend itself to an investor “scam”,
but it is clear that this Email needed a response because the anxiety is painful and seemingly unjustified. Call it a
writer’s professional handicap, I respond with an article. Also it seems to me that an article will reach probable other
investors with the same concern.
I've taken a careful look at all elements of this supposed transaction. I have spoken unofficially, to a number of people
which I believe in the know i.e. industry officials, trade officials etc including the communications director at FLKI. I’m
comfortable with my report.
Falken has officially not confirmed nor denied talks, but that response was addressed to the "rumor" that organic styled
talks were going on with two Fortune 500 companies which obviously would lead to a likely acquisition of FLKI.
Note however that people who know the company also know that its management has a voracious appetite for its innovative
independence and that that management believes that being acquired by a major would drive Falken ingenuity into the doldrums
as witness the three auto care product companies which compete with its Clean Plus® product conceptions and are owned by
majors.
I believe that it is the historic strategy of management to stay independent which of course caused the rampant profit taking
in FLKI that you have witnessed over the last month, crashing it to only 400% over the starting point and as of yesterday
confirming this bottom - I have called the bottom at 19 cents and am not likely to be proven wrong.
By the way even when pushed, the Manuel Garcia, the communications officer with whom I had a long talk about this, maintained
that the official position of the company is that it will not confirm nor deny that talks are continuing relating to the
strong interest of (he slipped on that one) three major companies.
Going to Spongetech SPGN (now SPGNE since trading in the stock was suspended) concerns, you should have none as those relate
to any investment in FLKI shares.
While Spongetech quite smartly apparently did enter into talks (because in appearance the synergies are incredibly good), and
a manufacturing proposition was submitted by FLKI, it was on a money up front basis, and at a very long arms length.
Knowing FLKI as well as I do, there is no way it will proceed during an investigation (and even less so during a suspension
of trading on incredibly inflated SPGN shares), and assuming SPGN is cleared - though its reputation is forever tarnished as
we know from the rules of this game - without perceiving and extracting a heavy price from SPGN.
There exist no basis that I could find to justify a worry about any rumor involving SPGN to the extent it concerns an
investment in FLKI shares. Indeed, as and between any reader and the lamp post I propose that FLKI shares will double by the
end of the year - in fact I'd say a savvy trader or investor should buy FLKI with a .204 cent bid picking up all the
stragglers under .19 and the .19.
Author Resource:-
John David is one of the nation's most respected expert analysts on the Automobile After-Market Industry. He holds
appointments as a covering analyst with some of the world's largest players. He also conducts a private practice as a
consultant in capital raises, mergers and acquisitions for small to medium size manufacturers in the consumer, professional
and industrial chemical, wipe, wet wipe and car and vehicular care industries.
Falken Industries Ltd OTC : FLKI is a diversified industrial conglomerate that operates in Chemicals, Wet Wipe and
Biodegradable Technology. Falken Industries Ltd is the concept behind more than 160 products distributed through a network of
global platforms and the recipient of trade awards for innovations, biodegradability and environmental and health quality
standards.
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