Is Remark Selling Minority Stake in Kankan?

November 24, 2017 at 10:00 am Leave a comment

Tweets from Remark Holdings’ account Wednesday morning appear to show Remark CEO Shing “seated at the big boy table” with executives from CDH, a firm with $18 Billion in assets under management that has just raised $450m for the stated purpose of investing in Artificial Intelligence startups. CDH most recently invested in Sensetime, a company that offers AI applications similar (with some complimentary) to Kankan and the pricing of Sensetime’s most recent raise implied a total value of about $2 Billion. Sensetime has an AI revenue run rate of approximately $100m, or about 3x the run rate of Kankan.

If a minority stake in Kankan is priced using that same 20x revenue valuation method, it would imply a total value for Kankan of $600 million, which would equate to approximately $22.30 per Remark share. Even if they valued Kankan at only 1/2 the valuation metric used in last month’s funding round for Sensetime, it would value Kankan at $11.15 per share – or about 30% higher than the current trading price of MARK shares, which we find remarkable given the company’s $6+ stake in Sharecare, core business (Vegas.com) worth up to $5 per share and its non core domain businesses worth at least $1 per share. There was already talk that MARK CEO Shing was in China this week meeting with potential investors and that the sale of a minority stake in Kankan to an investor or investors who could add strategic value in the region was being considered. Additionally, we note that Remark has consistently tweeted hints of big partnerships and contracts in the days leading up to official PRs announcing such deals. With MARK CEO Shing presenting as one of 35 VIP speakers at next week’s World Internet Conference in Wuzhen, Zhejiang Province, China, we cannot conceive of a better time or place to announce an initial round of funding to gain the greatest possible exposure for Kankan.

 

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Entry filed under: AI Funding, alibaba, Artificial Intelligence, China, Uncategorized.

Remark Holdings’ Balance Sheet Upgrade MARK w/ CP Group, Record Short Interest, World Internet Conference

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