Gediminas Jasionis
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LOI Keeps Selectcore Ltd. (CVE:SCG) (PINK:SLXXF) Stock Inflated

by Gediminas Jasionis Oct 13, 2011
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7scg_chart.pngSelectcore Ltd. (CVE:SCG) (PINK:SLXXF) share price stays inflated since traders got excited about the recently announced letter of intent.

SCG stock price held rather steady against the selling pressure on Thursday. The stock got inflated as a reaction to the recent news, but could very well collapse if the LOI doesn't fall through or there is a prolonged time frame until the actual agreement is made. 

On Wednesday, Selectore announced to have entered into a letter of intent with iSIGN Media Solutions Inc. to build a retail mobile proximity-advertising footprint in North America.

Under the LOI the companies should first attempt to install iSIGN's interactive marketing solution software and their smart antenna into SelectCore's Point of Sale terminals. The wide network of over 7 thousand locations provides substantial hardware coverage and thus there will be comparatively little expenditures to actually create the planned network. The preliminary calculations for capital expenditures predict $1.05 million.

selecore_logo.jpgThe current network, if updated with iSIGN's antennas, could cover up to 7 million viewers. Economic assesment shows that the potential annual revenues could reach up to $10 million, and SelectCore would be taking 80% share of it.

The initial contract would extend for three years with an options to expand it for another three.

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