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To
OTC Journal Members:
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Trading Alert:
SBI Communications, Inc. (OTC BB: SBID) |
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Today's trading alert is based on
three major factors:
-
The press release which came
out after the close puts a whole new light on this company, and will ultimately
increase the company's size and profitablility by 300%.
-
We have had extensive discussions
with management- this press release is the first in a series of very
exciting developments coming out on this company over the next several
weeks.
-
Technically, the stock is perfectly
positioned for substantial appreciation on the heels of this news.
SBI Communications owns Valencia
Entertainment. Valencia is an entertainment conglomerate which
owns TV and Movie production studios in both New York and Southern California.
According to Vince Vellardita, the
President and CEO, Valencia has been in business and operating profitably
for many years. The year 2000 audit is being completed and will be released
soon.
The CBS hit series JAG and
Fox Family's Power Rangers are both produced on Valencia
properties along with numerous other shows.
Today, shortly after the market closed,
SBI
announced they have signed a Letter of Intent to acquire Tri-Crown Productions,
Inc. Tri-Crown is an independent production company that has produced
shows for Aaron Spelling Productions, World-vision/Paramount, Prime/FOX
Sports. FOX Family Channel, Speed-vision, Outdoor Life and Univision.
In addition Tri-Crown has produced weekly series and specials for
ABC,
NBC, CBS, FOX, FOX Sports, FOX Family, Warner Bros., Telemundo, Universal,
Sony and Disney.
Tri-Crown owns its own library
of shows which are continuosly creating cash flow for the company. Once
shows are produced, on going syndication revenues have little costs, yielding
high profit margins.
Mr. Vellardita informs us that both
Valencia and Tri-Crown operated profitably in 2000, and he expects
those profits to increase in 2001. The combined companies will have annual
revenues of over $20 million, quite possibly as high as $30 million.
Entertainment content producers are
in high demand. 10 years ago we all watched 3 major networks and one local
station. Today, most of us have cable systems or direct TV with over 200
channels. Those networks need content, and this new company is positioned
to provide supply for this new demand.
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Trading
Alert Details |
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As depicted in the chart, SBID
has
been in a nice uptrend since the stock sold off at the end of December.
The lower trend line or "support line" demonstrates each low gets a little
higher.
The news release should bring a nice
surge of buying into the stock. The upper trendline shows resistance at
$1.60. Therefore, a break above $1.60 tomorrow would be very bullish.
On that basis, here is our recommendation:
*Buy up to $1.60
*Target Price: Short Term:
$2. If the stock can break above the December high of $2.20 it could
go a lot higher.
*Stop Loss: $1 or whatever
risk you are comfortable taking. Please use a stop loss.
*If the stock gaps up in the morning
don't invest until it comes back down.
We don't normally provide any follow
up on our Trading Alerts. They're designed for investors seeking short
term trades. As a result of extensive discussions with the management of
SBID,
we expect to publish three or four follow up editions on this company if
they produce the substantive fundamental developments management has indicated
we will see over the coming weeks.
Below find the complete text of the
press release for your review:
Thursday February 15, 4:05 pm Eastern
Time
Press Release
SOURCE: Valencia Entertainment/SBI
Communications, Inc.
Valencia/SBI Sign LOI to Merge
Tri-Crown Productions
One Stop Entertainment Solution Created Through
Merger
VALENCIA, Calif., Feb. 15 /PRNewswire/
-- Vince Vellardita, President and CEO of Valencia Entertainment/SBI Communications,
Inc. (OTC Bulletin Board: SBID; Frankfurt XETRA: SE8) announced today that
a letter of intent has been signed for the acquisition of Tri-Crown Productions,
Inc. and certain of its affiliates. The acquisition is subject to the companies
conducting due diligence and the signing of a definitive acquisition agreement.
Closing is anticipated on or before June 30th, 2001. Tri-Crown Productions
is an entertainment company that specializes in development, post-production
and distributing its own original television programs and video/DVD.
Tri-Crown Productions presently enjoys
annual revenues of approximately $15 million and holds assets that include
a postproduction facility with equipment and a library of television shows
and documentaries. The company is well established within the entertainment
industry and has created programs for all major broadcast networks, cable
networks and international networks during its 14-year history. Tri-Crown
has produced weekly series and specials for ABC, NBC, CBS, FOX, FOX Sports,
FOX Family, Warner Bros., Telemundo, Universal, Sony and Disney. Tri-Crown's
library continues to grow with programs shot on location around the world.
Vellardita stated, ``Tri-Crown is
an important link in completion of the company's business plan in making
Valencia/SBI a one-stop studio. In a manner reminiscent of the mega merger
of Time Warner and AOL, this corporate merger creates the standard 'one
plus one equals three' result by using each company's unique scope of services
and success to offer a greater multi-media, multi-service entity that will
create a single-destination entertainment solution.''
Valencia Entertainment's core properties
already host production for such popular TV shows as the hit CBS series
``JAG,'' and the Fox Family popular show ``Power Rangers.'' Valencia's
clients include: Warner Bros., Paramount, Universal, MGM, HBO, NBC, Twentieth
Century Fox, Disney, CBS, Sony, Showtime, and the USA Network.
``Tri-Crown Productions will be Valencia/SBI's
partner in creation, production and distribution to help grow the company
and increase revenues, thereby increasing shareholder value.'' Vellardita
further stated, ``at the time of closing, with this acquisition the company
anticipates revenues of approximately $25 million for 2001 and projected
revenues of over $150 million over the next five years. Upon completion
of this acquisition, the company will meet all requirements to apply for
a National Nasdaq listing of the company securities with the exception
of price.''
``We're elated at the prospects of
the merger,'' Valencia concluded. ``Not only does it significantly improve
the quality and volume of service we offer, but it enables us a corporate
perspective to attain new heights in our listing and performance.''
About Valencia/SBI
Valencia Entertainment is a vertically
integrated entertainment conglomerate that includes television production
for network and syndicate, motion pictures, sports, Internet and real estate
holdings. Valencia owns 30 acres of land located on both the east and west
coast, and approximately 300,000 square feet of commercial buildings, which
consists of ten film and production sound stages. The company recently
purchased Half-Day Video, Inc. bringing in over a million in revenue, with
over a million in real estate and television and film equipment to be rented
out. The company has contracts in place to utilize the sound stages with
Paramount Pictures for the hit CBS series ``JAG'' and Saban Entertainment
for the Fox Family popular show ``Power Rangers.'' Valencia's clients include:
Warner Bros., Universal, MGM, HBO, NBC, Twentieth Century Fox, Disney,
CBS, Sony, Showtime, and the USA Network. For more information, visit the
company web site: http://www.valenciaentertainment.com
.
About Tri-Crown Productions, Inc.
Carol Sherman, former Head of Finance
& Business Affairs for KABC, is the founder and CEO of Tri Crown Productions.
Together with Jeff Androsky, President of Production & Development,
the company started as the independent Production Company for ABC's daily
prime access series EYE ON LA. Within two months Tri-Crown moved the consistently
rated 3rd place rated series to #1 in its time period, and stayed #1 for
every ratings period under their production tenure. Tri-Crown quickly build
on that success by adding an elite post- production facility with 10 linear
and non-linear digital edit bays, digital sound and graphics studio and
stage facilities located in Burbank, California. Tri-Crown has produced
daily series with Aaron Spelling Productions, World- vision/Paramount,
Prime/FOX Sports. FOX Family Channel, Speed-vision, Outdoor Life and Univision.
In addition Tri-Crown has produced weekly series and specials for ABC,
NBC, CBS, FOX, FOX Sports, FOX Family, Warner Bros., Telemundo, Universal,
Sony and Disney. Tri-Crown's library continues to grow with programs shot
on location around the world.
Safe Harbor Statement
As a cautionary note to investors,
certain matters discussed in this press release may be forward-looking
statements within the meaning of the Private Securities Litigation Reform
Act of 1995. Such matters involve risks and uncertainties that may cause
actual results to differ materially, including the following: changes in
economic conditions; general competitive factors; SBI's ability to execute
its business model and strategic plans; and the risks described from time
to time in SBI Communications, Inc. Securities and Exchange Commission
filings.
SOURCE: Valencia Entertainment/SBI
Communications, Inc.
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