From the Desk of Irwin Michael – June 12, 2015

Com Dev International Ltd.

We have owned Com Dev International Ltd., a manufacturer and distributer of space communications for at least five years. We originally purchased its common shares at about $4 for our ABC Fundamental-Value Fund and continued to buy it as low as $1.65 such that our average price was approximately $2.80.

Since our initial purchase, we remained very confident in the company’s management team and recognized that Com Dev had a lot of potential. A second part of Com Dev’s business was its exactEarth division, a navigational ship tracking business via satellite which appeared extremely promising. This business grew very slowly and consequently the equity market gave it very little value. In fact, on December 31, 2014 Com Dev stock closed the year at $3.97.

After reviewing Com Dev over the past five months, we concluded that the company was extremely undervalued. As a result we decided to add to our holdings such that four of our ABC Funds: ABC Fully-Managed, ABC Fundamental-Value, ABC North American Deep-Value and ABC Dirt-Cheap Stock Funds now own significant amounts of these shares. It was our opinion that if we were patient we would be well-rewarded. In all candour, the lack of market respect with regard to Com Dev’s languishing share price was very frustrating. However, on Monday, June 8th, Com Dev’s exactEarth division announced a transformational strategic alliance with Harris Corporation (HRS-NYSE), a global leader in space communications and information systems. In short, this alliance will combine exactEarth’s technology with the communications expertise of Harris Corporation.

In summary, we believe that the implications of this alliance are quite material and transformational for Com Dev International. More importantly, as of Thursday, June 11th, it appears that the stock market has finally taken notice with the shares closing at $5.77.

Irwin A. Michael Signature

Irwin A. Michael, President
I.A. Michael Investment Counsel Ltd.


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