04:37:18 EDT Fri 14 Jun 2024
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Ciscom Corp
Symbol CISC
Shares Issued 53,563,833
Close 2024-05-23 C$ 0.095
Market Cap C$ 5,088,564
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Ciscom investor Zhang pans "obsession" over DLT's stake

2024-05-24 08:59 ET - Shareholders Letter

Ms. Ruby Zhang, an investor, reports


Dear Ciscom Corp. board of directors,

As a shareholder for the past three years, I am deeply concerned about the direction and management of Ciscom, especially in light of the disproportionate focus on DLT Resolution Inc.'s percentage of share ownership of Ciscom. This obsession has overshadowed crucial operational and strategic issues, leading to investor dissatisfaction and doubts about the company's leadership.

Management failures and missed opportunities

Ineffective management and oversight

The board has demonstrated a lack of effective oversight and strategic management. The preoccupation with DLT's share ownership distracts from addressing critical internal and market challenges. Investors expected pro-active management focused on growth, innovation and operational excellence, not ownership disputes.

Lack of strategic clarity

While Ciscom positions itself as a leader in the information and communication technology sector through acquisitions, recent communications lack clear, actionable strategies. A roll-up acquisition company must consistently show its ability to identify, acquire and integrate target companies efficiently. The recently filed MD&A (management's discussion and analysis) report contains no mention of any discussions, direction or potential acquisitions. This absence of clear strategic initiative raises concerns about the company's direction and leadership.

Poor investor relations and transparency

Continuous updates about DLT's share ownership, without substantial progress on core business activities, reflect poorly on Ciscom's investor relations. Investors seek transparency about business performance, future acquisitions and strategic growth plans, not just share disputes. The current approach fails to inspire confidence and creates an impression of management's preoccupation with non-essential issues.

The persistent focus on DLT's share ownership, in an unprecedented accumulation of shares in Ciscom, and resulting alleged non-compliance have overshadowed more-pressing issues. While regulatory compliance is essential, the board's disproportionate attention to this matter detracts from essential business activities. Investors are more concerned with how Ciscom is advancing its business goals, enhancing shareholder value and navigating market challenges.

Resignation of directors after re-election

The resignation of three directors shortly after re-electing themselves at the annual general meeting (AGM) in February raises serious concerns about the board's stability and integrity. This sequence of events suggests internal conflicts and a lack of confidence in the company's direction and governance, further undermining investor trust.

Increased financial claims against Ciscom

Records indicate former executive chairman and chief executive officer Drew Reid has significantly escalated his lawsuit against Ciscom, amending his wrongful dismissal claim to include a substantial $3-million defamation suit. This development indicates serious internal issues and potential financial consequences for the company. Investors are rightfully questioning how Ciscom will absorb such a significant loss.

Concerns about Ciscom's operations

There are growing concerns among investors about the true state of Ciscom's operations. The following points raise significant red flags:

  • Unsubstantiated claims and misleading information -- The company's communications focus on controversies and disputes rather than verifiable business achievements, suggesting a possible attempt to mislead investors.
  • Lack of tangible results -- Despite claims of robust business growth and successful acquisitions, there is a conspicuous absence of tangible results and clear evidence of these successes. Investors have not seen substantial returns or verifiable progress that would substantiate Ciscom's claims.
  • Questionable corporate governance -- The addition of new board members appears to be a superficial change aimed at pacifying concerned stakeholders, rather than a genuine effort to improve governance and performance.

Conclusion and recommendation

Ciscom's leadership must pivot from these distractions and realign its focus on strategic growth, effective management and transparent communication. The board should concentrate on demonstrating tangible progress in its acquisition strategy, fostering investor confidence through consistent and meaningful updates, and ensuring robust corporate governance that prioritizes long-term shareholder value.

I urge the board to reassess its priorities, address the management deficiencies, and provide a clear, actionable plan for future growth and success in the ICT sector. Failure to address these concerns promptly will only reinforce the perception that Ciscom is not effectively managing its business operations.


Ruby Zhang

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