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  "documentTitle": "Focus Media Holding Ltd. (FMCN)",
  "authorId": "51_Muddy_Waters",
  "authorName": "Carson C. Block",
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  "sourceTypeSlug": "short_seller",
  "sourceTypeLabel": "Short seller",
  "presentationDate": "2011-11-21 00:00:00",
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  "notes": "The slide combines a table of shareholding combinations with a narrative investigation into corporate fraud.",
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      "kind": "callout",
      "text": "FMCN fraudulently claimed to have acquired six mobile handset advertising companies that it in fact never acquired.",
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      "text": "When did FMCN first begin discussing selling Allyes to SilverLake and any other potential buyers? Which entities still hold their shares in Allyes? Who are the parties associated with Bronco Ventures and Unidex Holdings?",
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      "text": "These six phantom acquisitions constituted a $41.8 million loss in FMCN's filings. FMCN claimed to take the write-downs and dispose of the businesses because of adverse publicity these companies received for illegal spam marketing on March 15, 2008. However, we see from the SAIC files that even if FMCN had owned the companies, their full year performance in 2008 was substantially better than in 2007.",
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      "text": "FMCN fraudulently claimed to have acquired six mobile handset advertising companies that it in fact never acquired. In FMCN's 2009 20-F, it claimed to have written down nine companies in its mobile handset division on April 30, 2008 and February 28, 2009 for a loss on disposal of $50.9 million. There is a small problem with this disclosure though. FMCN had never owned six of those companies.",
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      "kind": "paragraph",
      "text": "From the above analysis, we think it is likely that the insider group had an eye toward an exit when they took their stake. In all scenarios, Xiong Xiangdong must have one of his entities continue to hold Allyes shares if Silver Lake does in fact own 90.8%. The likely explanation as to why Mr. Xiong split his stake between two entities is that he intended to flip one for a profitable exit, and use the profit to essentially give himself a free option on Allyes going public.",
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      "text": "84 4th Amendment to the 2009 20-F, p. 78.",
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      "text": "Combination A, B, and C shareholding tables",
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      "kind": "title",
      "text": "IX. How to Fail in Business Without Really Trying: Phantom Acquisitions and Write-Downs",
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