Montage Technology Group Ltd (NASDAQ:MONT) new report from Gravity research, see this article for background.
Montage Technology Group Ltd (NASDAQ:MONT) is a Chinese fabless semiconductor company with the vast majority of its purported revenues coming from set-top box chips. Last Thursday, we published a report providing strong evidence that MONT is engaging in fraud. MONT issued a weak response that failed to address nearly all of the allegations in the report. In that response, MONT claimed that Shanghai Montage Microelectronics Technology Company Ltd. (“SMMT”) is not an affiliate of MONT and has not been since 2009.
In a new report, we refute MONT’s lie that SMMT has not been affiliated with MONT since 2009. We produce new conclusive evidence showing that SMMT has been owned/controlled by MONT and related parties even during the time period after SMMT acquired LQW and in 2013-well after MONT began recognizing significant revenue from LQW. This evidence includes:
1) At the date that SMMT acquired LQW, SMMT was owned by senior Montage Technology Group Ltd (NASDAQ:MONT) employee Wu Lei and an individual (Yang Chongyi) that we believe is almost certainly a sibling or cousin of MONT CEO Howard Yang (Yang Chonghe)
2) SMMT’s corporate filings show that Wu Lei (engineering director at MONT), Yang Chongyi (almost certainly a sibling or cousin of MONT CEO Howard Yang/Yang Chonghe), and Phoebe Su (VP of Finance and Administration at MONT) were directors of SMMT until June 30, 2012-well after SMMT acquired LQW and after MONT reported generating significant revenue from LQW
3) We have obtained Shanghai filings for SMMT showing that, as of 2013, even after the transfer of SMMT ownership to Zhu Yan and Chen Yueci, the e-mail address provided as a contact with SMMT’s 2012 tax filings (filed in calendar year 2013) belonged to a MONT employee
4) The phone number for SMMT listed in its current Shanghai corporate registration information belongs to MONT. Dialing the number, (+86 (21) 5169-6833), takes the caller directly to MONT’s IVR system
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Reiterating Coverage on Montage Technology Inc – Strong Sell (1)