Can POET write a new chapter for Opel?

The trajectory of Opel International’s (TSXV:OPL) story is not unfamiliar to investors in the space. The company, which was based in New Brunswick but recently moved its offices back to Ontario, went public on the TSXV in June 2007, raising $10.7 million in a reverse takeover.

Shares of Opel soared on the promise of its innovation in high-concentration photovoltaic cells, an area in which the company has applied for more than forty patents and been granted twenty one. The company’s stock hit a high of $2.25 in November of that year. But when the recession hit, Opel was hit especially hard, falling to $.12 cents by Halloween 2008. Investors were no doubt taking as much stock of the company’s’ losses, which ended up at just under $6 million for fiscal 2007, as they were the company’s perceived leadership position.

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Since that time Opel has continued to unveil a string of prestigious grants, awards and pilot projects with institutions such as the National Research Council of Canada and US Department of Defence, but the company’s stock didn’t budge as revenue was scant, topping out at $1.52 million in 2008, a year the company lost five million dollars.

On Monday, however, management of Opel requested the exchange halt their stock, pending news. That news, which was released yesterday, vaulted the normally dormant company to the top of the list of the TSX Venture Exchange’s heaviest traders. The company announced that it had received a third party valuation of its The Planar Opto Electronic Technology (POET), that valued it at over a billion dollars.

The US based Pellegrino & Associates, which describes itself as a “valuation services firm” has offices Indianapolis, Indiana, and San Jose. The company counts Fortune 500 firms such as Consolidated Edison, American Express, IBM, and Lockheed Martin as clients. They performed what Opel referred to in a press release yesterday as “an analysis of the uses of the POET technology, the sales it could achieve in its targeted end-markets, and likely margins if Opel can complete its research and development activities successfully and the market adopts the POET technology”

Opel claims that its Planar Opto Electronic Technology, means faster semiconductor operating frequencies of up to 100 gigahertz lower heat losses, greater reliability and total system cost.

Investors bullish on Opel more than doubled the price of the company’s stock yesterday, to $.68 cents. Some, no doubt, believe that the company’s days as a quasi-research facility are over, and that POET means the Opel’s technologies can begin to compete and win business in the free market. To that end the company said it was “working with leading defense systems integrator companies, and with military and government agencies to develop important applications for the technology”. But the company also cautioned that the Pellegrino report “is not an indication of interest by any party, nor does it represent an actual offer to purchase the POET intellectual property.”

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