Global Spill Management
(NASDAQ BB - GEGI)

As you may recall, on August 20, 1997 we featured an E-mail recommendation namely, GLobal Spill Management, Inc. (GEGI-Nasdaq BB) @ .375. Global at that time was a "SHELL" corporation for further explanation of GEGE please revisit our web-site and "click" the free update BAR and review the August 20th, 1997 E-mail. This will totally refresh one's memory.

GEGI on or about September 17, 1997 announced that it was negotiating to acquire BioFarm Holdings S.A. a U.K.-based holding company which controls BioFarm S.A. in Romania. The company anticipates sales of $16 million for 1997 ending Dec. The company was incorporated in Romania in 1920 and produces more than 220 drugs for both human and veterinary uses. BioFarm has nearly 700 employees in three manufacturing sites situated in central Bucharest.

On October 13, 1997 GEGI announced that it has signed a delinutive letter of intent to aquire BioFarm S.A. Globalwill acquire BioFarms in exchange for a GLobal Convertible Debenture (remember that GEGI shareholders will own 15% of the company after the acquisition). It is our understanding that BioFarm has no intent to convert its Debenture any time soon because if it does, it will not be entitled to use the $11 million NOL. This NOL is extremely attractive due to ability to reduce taxes for many years!!!

At present there are only 3 million shares outstanding fully diluted. This will be used for our fundamental figuring.

Closing of the transaction will be effected upon the delivery of BioFarm audited financial statement and the filling thereof with the SEC on Form 8-K. BioFarm's "Big Six" accounting firm will submit such audited financials to GEGI's accountants within the next 60 days.

Important: The audited BioFarm Financials will not include ACQUISITIONS intended to be be concluded by BioFarm within the near future. Each such proposed acquisition will be subject of a separate audit, with full consolidation to occur on December 31, 1997.

Assume that BioFarm itself acquires other pharmaceutical companies, and further assuming that the initial two such proposed acquisitions have a combined sales totaling $10 million and further assuming a continuation of an 8% profit margin, BioFarm's revenue would approach $26 million and net income would equal $2.1 million. Bases upon the three million shares that are currently outstanding, the not income/share equals an extremely attractive .70/share. (One could consider this scenario, but it's not a true picture! If we assume that all the Debenture was converted promptly, which is highly unlikely, then we would have a total of 20 million shares outstanding. If this was the case then based upon the net income/share before taxes GEGI would earn .105/share. This is not believable because the company wants to use the $11 million NOL.)

If this company actually shows the net income as promised (stipulated as part of the conditions for BioFarm's closing then GEGI is only trading at a PE of 1X 1997 earning estimates. This sounds extremely attractive to us any way you slice, dice, carve or chew it!

If you would like to get a handle on the opportunities that exist in Romania, please secure a copy of the September 22, 1997 Forbes magazine and see pages 128-131. You will be totally shocked by what you see!!

Within the chart located on page 130, one of the companies mentioned is a pharmaceutical that has stated sales of only $4.5 million and net income/share of .20-70 million shares outstanding-the share price is $1.15

If GEGI were to trade at 60X earnings, then its share price could approach $42. This of course is ridiculous, but GEGI could trade at 10-15X 1997 estimated earnings and trade at $7.00 to $10.50 based upon the 3 million shares currently outstanding. If we are even more conservative and assume a PE valuation of only 5X, then we still got a share valuation of $3.50 - a far-cry from current levels, that is $.70.

GEGI, since first exposed, has appreciated quite nicely from the .375 level, but it is in our opinion that once the story gets out to the masses that GEGI will appreciate rapidly from current levels of .70.

If we also look at PSR, the listed company in Forbes currently sports a PSR of 15X - an extremely overpriced variable. When we look at GEGI and base its PSR on either 3-20 million shares, we get an attractive value of .08 to .54 values that indicate severe undervalued pricing.

In our opinion, GEGI should trade at much higher levels if all that is promised holds true. There, of course, are risks, but the rewards in our opinion outshine any downside! Remember, according to the E-mail dated August 20, 1997, shareholders of record are promised certain recovered assets from pending litigations.

We like GEGI and continue to hold our position for further capital GAINS!! For "NEW" investors types, GEGI offers international exposure, rapid growth potential, liquidation rites of prior company (up to $1.50 recoverable) and a fundamentally cheap and obscure investment opportunity.

Broker contact: Mike Chesler 1-800-331-1355. Corporate #: Desiree Piorson 1-610-495-8413

PS: As of November 1, 1997, GEGI is waiting for a judge's brief on the illegal sale of 1.1 million shares with a market value of $3.8 million. The FBI is also involved investigating the illegal activity. GEGI shareholders are going to love the outcome. Remember that during 8-2-96 and 9-19-96 certain parties illegally sold shares from two S-8 registration statements filed with the SEC during this time period. The recovery will be potentially huge!

The BioFarms audited statements are due out early November. We hear that the assets are in excess of $22 million and the net income approaches $1.2 - $1.6 million. Note: this does not include the other two acquisitions. We anticipate that this whole deal will be finalized by November 15, 1997.
We belive that GEGI could very well trade between $2 - $4 by year-end. We also anticipate European buying to start soon after the closing