Kirin International Holding Inc (OTCMKTS:KIRI) Goes Wild on the Charts
Another session and another massive green day for Kirin International Holding Inc (OTCMKTS:KIRI). By the closing bell yesterday KIRI‘s share price was another 17% up, at $3.52 and at a three-year high for the company. There is still no logical reason for this latest price run.
As we discussed in our previous articles, KIRI is an OTC-traded company based in and operating out of China. There has been no news coming from KIRI since early September and the share price has been on quite a rollercoaster ride since then.
The original PR that sparked interest and helped KIRI climb to $3 per share was dated Sep 10 an concerned a very intriguing deal. According to the announcement, KIRI signed a memorandum of understanding to acquire 100% interest in a company called “Wuhan Yangtze River New Port Logistics Co”. This entity operates a logistics center on the Yangtze river – the longest waterway in China and all of Asia.
The deal, should it ever evolve into something more than a memorandum of understanding, involves KIRI issuing 160,000,000 shares at nearly three times its current market price, or $10 apiece, to acquire the company operating the logistics center in what would be a $1.6 billion deal. Frankly, we are having a bit of a hard time figuring out the logic behind such a move and especially behind the share price proposed for the deal.
KIRI had just 20 million outstanding common shares as of its last quarterly report dated June 2015.
The big percentile run from under $2 per share last Monday to over $3.50 yesterday took place on virtually zero news or positive materially significant announcements from the company. KIRI is currently running on formless, vague excitement and that could give way at any moment. Then again, every trader should be aware of the dangers of chasing a green runner up the charts.
