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Investing

ChinaCast, From Troubled To Dysfunctional (CAST)

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By Jon C. Ogg Updated Published

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ChinaCast Education Corporation (NASDAQ: CAST) is one of the Chinese companies where investors might not be best served by management.  Infighting at the board of director level appears to be met with resignations and delayed financial filings.  Today’s news looks like dysfunctional behavior at its best.

Ron Chan, ex-Chairman and CEO of ChinaCast has now resigned from the board of directors over serious disagreements with the group of directors.  Then came news from the board of directors which issued a scathing letter to shareholders.  FULL LETTER

To add insult to injury, NASDAQ halted trading in the stock.  When investors get into stocks that have management infighting it rarely turns out that well.  Keep in mind that this is in China as well, and we have said over and over that perhaps the most evident example in freedom speech comes from financial officers of companies which listed shares in America.

ChinaCast provides post-secondary education and e-learning services in China.  This is a situation which seems far from over.

Shares went out down 4.5% on Friday at $4.24 and the 52-week trading range is $2.27 to $6.91.

JON C. OGG

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About the Author Jon C. Ogg →

Jon Ogg has been a financial news analyst since 1997. Mr. Ogg set up one of the first audio squawk box services for traders called TTN, which he sold in 2003. He has previously worked as a licensed broker to some of the top U.S. and E.U. financial institutions, managed capital, and has raised private capital at the seed and venture stage. He has lived in Copenhagen, Denmark, as well as New York and Chicago, and he now lives in Houston, Texas. Jon received a Bachelor of Business Administration in finance at University of Houston in 1992. www.247wallst.com.

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