The Hartcourt Companies, Inc. (OTCBB: HRCT) of Los Angeles, a diversified holding company, announced Wednesday April 30th the acquisition of 45% of Guangdong NewHuaSun Computer Co. Ltd, marking the second Chinese PC distributor Hartcourt has purchased.
Hartcourt had acquired HuaQing, the first PC distributor, on March 17th, bringing the combined PC distributors revenue to approximately $125 million dollars. Hartcourt's strategy is to acquire high-growth businesses in China and by the look of its recent acquisition this week, it appears to be doing just that.
Hartcourt is an usual story in that its an American company focused on acquiring Chinese companies. What has been in vogue by Asian entrepreneurs is to merge their business into an American shell corporation. That foreign enigma was due to the stability of the American dollar and access to our capital markets. Few of these reverse mergers have proven to be successful.
Axcess Business News had covered a Korean security equipment manufacturer who essentially gone public in via a shell merger. Hunno Technologies (OTCBB: HUNN), which had Fortune 500 ties and multi-million dollar contracts, to date has been unsuccessful in its attempts to find a receptive ear on Wall Street. But in the case of Hartcourt Companies, Inc., the strategy seems to be working when applied in reverse and acquisitions were negotiated to purchase Asian companies.
Behind Hartcourt's success is Mr. Alan Phan, Chairman of Hartcourt, who has patiently surrounded himself with very distinguished board members and a management team that knows how to work collectively. A combination that in any business today is hard to find.
Axcess Business News credits Phan's long-term thinking and sharp people skills with the Company's recent success. Prior to the acquisitions of NewHuaSun and HuaQing Phan had shown his forward thinking by launching China Report magazine on March 4th. The magazine is financial in focus and centers on doing business in China, reporting on those industries worth watching. China Report is being distributed directly to investment banking firms, fund managers, venture capitalists and brokerage houses throughout the US, Europe and - Asia. It is Phan's vision to bring awareness to the financial community of the many opportunities that exist in China, shaking the stigma of government restrictions and complex laws.
Hartcourt's shares shot up 100% since signing the initial letter of intent with Guangdong NewHuaSun Computer Co. LTD, closing Thursday May 1 at $0.48 on volume of 624,400 shares. Average volume was reported to be 519,838 shares. HRCT's 52 week hi/lo share price is $0.046 to $0.55. Axcess Business News added HRCT to its Stock Guide's "best picks" column on the close of trading today.
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