hmmmm, page-8

my few random thoughts would be....

at current market cap of 30M is either clearly oversold or is going bankrupt...

consulting half of business, good consistent growth, >1M profit, recently added SOA division and 4th leg key management division, you would think should be independently valued at around 20M or 4cents share price??

encryption side of business obviously wildcard and currently market has marked down this side of business savagely.... I had thought that there was a strong SONET pipeline of sales through safenet to be completed by end of calendar 07 so am a little concerned we haven't heard anything about that, either didnt eventuate or safenet still playing games...

I dont think ethernet products (larger market) have ever been represented through safenet as they seem preferentially to sell ?cipher optics gear in that domain although that should change with ncipher partnership and their sales into US market....

senetas partner smart quantum recently listed on market, first quantum supplier to do so and are planning sales of quantum encryptors of 20M euro by 2010....bugger all this year....

I see current market price as a result of background market volatility leading to lack of market depth combined with someone large selling down, probably RL and associates (?IKL) probably related to green invest in some manner, stockdale and JDB both made references in the AGM to a takeover target / deal that was shutdown and a change of direction.... really there is bugger all volume going through with only ?5% turnover last couple months...

going forward I see a small possibility of a vector takeover (see below) if they have made signigicant sonet sales of which they have not notified sen of and if they could t/o sen on the cheap which would depend on the current state of the register, I assume narrogal is still a significant holder who ever that may be.... I would have thought if this was going to happen it would be in the next couple of months when sen is at its weakest....

I expect half yearly result to be +/- 200k so will probably have no effect on share price....

2086 is the wildcard and is due for release at some stage in the next 6 weeks. This is a very significant release for sen and will hopefully be accompanied by some sort of significant announcement which will result in an increase of liquidity / volume for sen and thus remove the overhead selling pressure and restore the shareprice to the 10-12cent range.....

after that if there is no takeover from vector and barring any left field surprises then i do not expect any large increases in shareprice until second half when the pipeline of sales they have established starts to come through and hopefully the relationship with telstra and ncipher is clarified....



----------------------------------------



Vector Capital managers say they plan to tap a $1.2 billion coffer to do around 10 to 12 acquisition deals in the next 12 months.

By Reuters
InformationWeek
January 24, 2008 11:00 PM

SAN FRANCISCO - After the good times, enter the clean-up crew.

As tech stocks take a beating, private equity firm Vector Capital is seeing a host of new targets among small and mid-sized technology companies for its brand of investment and restructuring, founder Alex Slusky said in an interview.

"There were about 50 companies on our screens three or four months ago, now there are 150," said Slusky, who started Vector in San Francisco a decade ago. "It's a great time for us to acquire."

Vector is a "value investor," opportunistically buying tech companies that are undervalued relative to their growth potential -- either due to poor management, market conditions or because they have been "orphaned" by a previous acquirer.

The technology-focused firm is best known for its buyout of Canadian software company Corel in 2003. Other down-on-their-luck technology brands Vector has acquired include Register.com, SafeNet, WatchGuard Technologies and WinZip.

Although the tech sector has remained relatively insulated from the subprime and credit market crises, mounting fears of a recession are hitting tech stocks now, shaving as much as a third off the market value of a growing number of small or micro-cap companies in the past six months, Slusky said.

Tech companies whose market values have been slashed to a range of $100 million and $500 million are ideal targets, Slusky said.

Profitable software and IT services companies may also see revenue dip in coming quarters.

Businesses, especially financial services companies that are among the tech industry's largest customers and hardest hit by the credit and equity market crises, may cut back on capital expenditures like IT spending, further depressing tech company stock prices and making them attractive buys, Slusky said.

Vector is already looking closely at such companies, said Slusky, who declined to give further details.

"You can expect us to get much more active in the next 12 months," he said.

The firm plans to use money from its $1.2 billion fourth fund, which closed in July of last year, to do around 10 to 12 deals, Slusky said. Its previous fund, that closed in 2005, was about 30% that size at $350 million.

Vector has built its reputation on taking struggling tech companies off the market and turning them around, or acquiring non-core divisions of large tech companies like Intel (NSDQ: INTC) and Symantec (NSDQ: SYMC) and spinning them into independent businesses.

In 2003, Vector took Corel private, retooled it and took it public again in 2006. It also acquired WinZip, which makes software that compresses large files for mailing or storage, and has taken software companies like SafeNet and BroadVision private.

Vector has been spared the recent woes of many large buyout shops whose deals are at risk as debt becomes more expensive and difficult to obtain.

Slusky said his firm had been very conservative in the past two years. "By being defensive up until now, we've marshaled our resources," he said.

"Cheap debt helps get deals done, but it won't at the end of the day get outcomes."


http://www.informationweek.com/news/showArticle.jhtml?articleID=205918280