|XG Tech Regs
||COM SHS USD0.00001 (REG S)
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|Technology Hardware & Equipment
Real-Time news about XG Tech Regs (London Stock Exchange): 0 recent articles
|looky: something is up here. More volume over the last 2 days than over the whole year and the share price goes up 70% ish. If this technology is adopted then these could well be $30. Time will tell.|
|badgerry: Based on the share price performance it doesnt look like people have been very impresed by the presentation? The company's statement reads like alot of mumbo jumbo - we will see? Reminds me of the definition of an expert as somebody who you cant understand. Good luck to holders but a bit too risky for me.|
Take AIM: Funds look at US-based xG - lured to London by legal fears
Published: 08:29 Friday 13 April 2007
By Douglas Bence, Companies Correspondent
It may be early, but here's one for the Christmas quiz. Name an AIM-listed company with next to no income and a share price of over $17. You have three guesses, and if the first two mention biotechnology or oil, gas or mineral exploration, then you're wrong.
The answer is Florida-based xG Technology whose 120 million-plus shares were floated by Hichens Harrison and started trading at $4.50 each on 20 November, initially capitalising this communications technology business at $544 million (£275 million).
After successful field testing, later this month it installs its first base station for the Florida cable company Far Reach at Daytona Beach, Florida, as the first step towards a low frequency, low power telecommunication service that co-founder Rick Mooers believes can revolutionise the industry.
Well, 'he would say that' is the obvious response. But some institutions have already voted with their wallets and others are looking into the possibilities, including Framlington and the hedge funds Bluecrest, and Tiburon Partners, it is understood.
The annual report shows that 46.3% of the shares are in the hands of the MB Merchant Group, the holding company of MooersBranton Merchant Bank owned by xG's co-founders, chairman and chief executive Mooers, and chief financial officer Roger Branton.
Iceland-based Stormur Holdings AB has 18.2% and ACH Securities SA of Geneva 17.7%; both represent Nordic investment houses. Only 10% of the freefloat was unlocked, so there weren't many institutions who could get worthwhile stakes at the time of the listing.
What on earth is a US company with no income as yet that capitalises at $2 billion doing on AIM?
As well as showing the US regulatory authorities in a less than favourable light, the answer goes a long way towards silencing some of the recent criticism of AIM and is evidence for those who think that London will soon overtake New York as the financial capital of the world.
Mooers told Citywire that it was impossible for the company to be floated in the US under the current regulations at this relatively early stage of its development.
But a listing was possible using AIM which gave the company the capitalisation value it needed to deal with companies already established in the industry and to negotiate agreements with potential partners.
Although Europe is not yet as litigious as the US, the AIM listing also allows xG Technology to manage the real risk of the American legal system where any allegation, no matter how ludicrous, has to be hauled through the courts at a vast cost that can seriously cripple any new business.
This legal argument also applies to patents and their alleged infringement which seems to be a way of life in the drugs and electronics industries.
Earlier this week Tate & Lyle, for example, went to the US International Trade Commission alleging patent infringement by three Chinese manufacturing groups and 18 importers and distributors of its sucralose manufacturing technology.
'While others may try to steal our technology, there may also be those who think we've stolen their's,' Mooers told Citywire. 'Being on AIM allows us to deal with this risk. In the early stages of a company's development there are serious shortcomings in the US legal system. AIM offered us a wonderful opportunity'.
Lower frequency signals travel further than those of traditional mobile phones so in theory larger networks can be built with far fewer base stations. Although others are pending, xG's single patent enables large amounts of data to be transmitted at low frequencies.
Or in more formal language, the company 'owns and intends to commercially exploit the intellectual property rights to a radio frequency modulation and encoding technology' called xG Flash Signal.
The next step for xG is to cover up to 90 markets in the US with around 700 base stations which will be produced for $2,700 each. Both Mexico and the UK are high on the next list of priorities.
Although the first 10,000 handsets were designed in Sweden and will cost around $285 each, later phones will be made in China and the price will drop close to $150.
The Daily Telegraph said there was a whiff of the dotcom boom about xG. Certainly it could either disappear almost before it's started or be one of the growth stories of the year.|
XG Tech Regs share price data is direct from the London Stock Exchange