SecProbe.io

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MAIL STOP 05-11

September 16, 2004

Mr. Cary M. Grossman
Co-Chief Executive Officer
Coastal Bancshares Acquisition Corp.
9821 Katy Freeway
Suite 500
Houston, TX 77024

Re:	Coastal Bancshares Acquisition Corp.
		Registration Statement on Form S-1
		File No. 333-118294
Filed August 17, 2004

Dear Mr. Grossman:

We have reviewed your filing and have the following comments.  Where
indicated, we think you should revise your document in response to
these comments.  If you disagree, we will consider your explanation as
to why our comment is inapplicable or a revision is unnecessary.
Please be as detailed as necessary in your explanation.  In some of
our comments, we may ask you to provide us with supplemental
information so we may better understand your disclosure.  After
reviewing this information, we may or may not raise additional
comments.

	We urge all persons who are responsible for the accuracy and
adequacy of the disclosure in the filings reviewed by the staff to be
certain that they have provided all information investors require for
an informed decision.  Since the company and its management are in
possession of all facts relating to a company`s disclosure, they are
responsible for the accuracy and adequacy of the disclosures they have
made.

	Notwithstanding our comments, in the event the company requests
acceleration of the effective date of the pending registration
statement, it should furnish a letter, at the time of such request,
acknowledging that

* should the Commission or the staff, acting pursuant to delegated
authority, declare the filing effective, it does not foreclose the
Commission from taking any action with respect to the filing;
* the action of the Commission or the staff, acting pursuant to
delegated authority, in declaring the filing effective, does not
relieve the company from its full responsibility for the adequacy and
accuracy of the disclosure in the filing; and
* the company may not assert this action as defense in any proceeding
initiated by the Commission or any person under the federal securities
laws of the United States.

	In addition, please be advised that the Division of Enforcement
has access to all information you provide to the staff of the Division
of Corporation Finance in connection with our review of your filing or
in response to our comments on your filing.

We will consider a written request for acceleration of the effective
date of the registration statement as a confirmation of the fact that
those requesting acceleration are aware of their respective
responsibilities under the Securities Act of 1933 and the Securities
Exchange Act of 1934 as they relate to the proposed public offering of
the securities specified in the above registration statement.  We will
act on the request and, pursuant to delegated authority, grant
acceleration of the effective date.

Please understand that the purpose of our review process is to assist
you in your compliance with the applicable disclosure requirements and
to enhance the overall disclosure in your filing.  We look forward to
working with you in these respects.  We welcome any questions you may
have about our comments or on any other aspect of our review.  Feel
free to call us at the telephone numbers listed at the end of this
letter.

General
1. It is noted that a number of exhibits are to be filed by amendment.
Please be advised that upon receipt of such information the staff will
require time to review these documents, and we may have additional
comments.
2. Please furnish supplementally a statement as to whether or not the
amount of compensation to be allowed or paid to the underwriters has
been cleared with the NASD.  Prior to the effectiveness of this
registration statement, the staff requests that we be provided with a
copy of the letter informing that the NASD has no objections.
3. Prior to effectiveness of this registration statement, please
confirm supplementally that you have resolved any outstanding state
regulatory agency comments and that you have received clearance from
all states where you have applied to have the units registered for
sale.
4. Please note the updating requirements for the financial statements
and related disclosures pursuant to Rules 3-12 of Regulation S-X.
5. Please provide a current accountant`s consent in any amendment.

Prospectus Cover Page
6. Please limit the prospectus cover to one EDGAR page as indicated by
Item 501(b) of Regulation S-K.
7. A "Targeted Acquisition Corporation," or "TAC," is defined as a
blank check company organized for the purpose of acquiring or merging
with an operating business in a specified industry.  According to the
filing, your objective is to acquire an operating commercial bank or
commercial bank holding company.  Given the very broad array of non-
banking activities a bank holding company may engage in, we are
unclear how your objective satisfies the TAC definition.   Please
explain how such definition is consistent with this offering. Upon
receipt, we may have additional comments.
8. Title the warrants "redeemable warrants" or "callable warrants"
hereon and wherever else appropriate.

Prospectus Summary
9. The discussion under Opportunity Analysis through the bottom of
page one, as well as the identical information on page 23, is
promotional and speculative and inappropriate in a disclosure
document.  It should be removed.

Risk Factors, page 7
10. Clarify in risk factor 10 that certain of your officers and
directors, or their affiliates, are already affiliated with blank
check companies.  Identify these persons and the companies, as well as
the fact that these companies recently filed Form S-1s with the
Commission that have gone effective.
11. Reference is made to risk factor 15.  Please advise whether any
arrangements or plans exist whereby the company`s existing
shareholders, officers, directors, promoters or affiliates thereof
will purchase securities in this offering.  If any do, please file as
exhibits.  If none, so state.
12. Risk factors 24-28, 30-33 and 37 are generic and could apply to
any company.  Please delete these risk factors.

Proposed Business, page 23
13. Please disclose whether the company`s search for a target company
will be limited to the United States.

Management, page 41
14. Please include a sub-section hereunder disclosing the Prior
Involvement of Principals (promoters, officers, directors, their
affiliates) in Blank-Check Companies.  The discussion should include
the identity of the blank check company, the date of its initial
public offering, amount of proceeds, date of acquisition, if any, name
of target company, current status of the combined company and current
involvement of the principal.

15. Indicate the current status of the Pentacon bankruptcy and the
location of the bankruptcy court.
16. For all companies listed, indicate which are SEC reporting
companies and provide trading symbols where appropriate.
17. Disclose the date Mr. Grossman began service at Sand Hill IT
Security Acquisition Corp.  Provide disclose regarding Mr. Grossman`s
relationship with MGI2, Inc.

Principal Stockholders, page 45
18. Footnote 3 states that Mr. Grossman is the beneficial owner of the
shares held by Coastal Acquisition, LLC.  Disclosure elsewhere
suggests that this is an entity affiliated with both Messrs. Grossman
and Brunson.  Supplementally advise whether Mr. Brunson shares
beneficial ownership of the securities held by Coastal Acquisition,
LLC, and if not, what his exact affiliation with Coastal Acquisition,
LLC is.  If he does share beneficial ownership, please revise the
table and footnote to reflect this fact.

Certain Transactions, page 47
19. Clarify in the first paragraph following the table that the
holders have agreed with the company to register the shares for
resale.
20. Disclose any out-of-pocket business expenses currently owed to the
officers and directors.

Exhibits
21. Exhibits 3.1, 10.11 and 10.12 contain no signatures.  Please file
validly executed documents for these exhibits and for those to be
filed by amendment.
22. The audit report and consent filed on Edgar do not have an
electronic signature from the auditors, Hein and Associates LLP, as
required by Subpart 232.302 of Regulation S-T.  Please request that
the auditors prepare an amended audit report and consent with the
electronic signature required and file with your amendment.
23. The form of underwriting agreement filed as exhibit 1.1 refers to
an aggregate of 3,600,000 units.  Please reconcile with the offering
prospectus.
24. Section 6(b) of the underwriting agreement allows the registrant
and the underwriter to terminate the agreement, but not the obligation
to do so, if more than a 10% default occurs and purchase of the
defaulted shares is not arranged.  This, in our view, would constitute
less than a firm commitment for all of the securities.  The language
should be revised to state that "this agreement will be terminated by
you or the Company. . ." if such a default occurs.

Closing Statements

As appropriate, please amend your registration statement in response
to these comments.  You may wish to provide us with marked copies of
the amendment to expedite our review.  Please furnish a cover letter
with your amendment that keys your responses to our comments and
provides any requested supplemental information.  Detailed cover
letters greatly facilitate our review.  Please understand that we may
have additional comments after reviewing your amendment and responses
to our comments.

We direct your attention to Rules 460 and 461 regarding requesting
acceleration of a registration statement.  Please allow adequate time
after the filing of any amendment for further review before submitting
a request for acceleration.  Please provide this request at least two
business days in advance of the requested effective date.

You may contact Babette Cooper at (202) 824-5069 if you have questions
regarding comments on the financial statements and related matters.
Please contact William Bennett at (202) 942-0135 with any other
questions.

Sincerely,

John Reynolds, Assistant Director
Office of Emerging Growth Companies

cc:	Ronald J. Frappier, Esq.
	Fax: (214) 855-4300

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