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  • The China Surprise Is Lurking [View article]
    Not the dumbest China piece you have written -- which is a big statement in itself -- but almost...

    How are is that 'selling puts buying calls' CCME strategy working out for you?
    Apr 22, 2011. 01:19 AM | 3 Likes Like |Link to Comment
  • 6 Reasons I'm Short ChinaCast Education [View article]
    Likely something along those lines.
    My fund has looked at 10 of these types of deals.
    Could never get comfortable with the legal/tax aspects, nor did we really like the growth prospects when fixed $ required for each additional student (to MoE direct/indirect or in expanding campus/facilities (mandated by law).

    Check out my instablog on ADY, this is a company with REAL problems.
    Apr 8, 2011. 11:07 AM | Likes Like |Link to Comment
  • 6 Reasons I'm Short ChinaCast Education [View article]
    You could well be right about Chinacast, but I usually have a pretty good nose for these things and it didn't twitch when I heard the CEO pitch the company recently. Without having bothered to really look closely at the details I think you might be making something out of nothing with these related party transactions. Drawing from my experience in structurig grey area deals in China I would guess that these seeming connected-party trasnactions were actually just intermediate steps which were introduced to avoid unnecessary local/provincial/national scrutny in re-structuring. Remember, edcuation is very sensitive territory in China, especially the sector CAST plays in. They probably just wanted to preserve 计划内 status.

    That said, paid-for secondary/tertiary education in the PRC is generally a terrible business.
    Apr 8, 2011. 10:33 AM | Likes Like |Link to Comment