I agree there has been a shift from the company but it wasn't 6 months ago. It was roughly 2 years ago in my opinion. I think I posted 12-18 months ago that the strategic direction of the company had changed from "lets get incorporated through a whole companies products" to "lets develop new tests which previously were not possible without our IP then try and be incorporated through all the products". I am not sure whether the company just thought that because of the strong financial & sensitivity benefits M&G bring to the table that big companies would just incorporate our product. Instead they are now contracting industry leaders to get the sales of the line IMO. I think sometimes when you have such a strong value proposition that you think the product will just sell itself. In most circumstances that isn't the case especially when dealing with multi billion dollar corporations whom don't want t be shown up by a 66M company from Australia.
The change was when we developed our own kits for third parties to use primarily for this purpose. This has put mix and go in the hands on many scientists already and this will snowball in 2016.
Something I just remembered from the 2014 AGM. I think it was DS that asked whether any of the big companies we were dealing with needed ISO certification (as a requirement) and from memory the answer was NO. Personally, I found that a little strange and I think you will find that the big boys we are dealing with are dictating to us what they require to interact with us and I think you will find this is one of them.
I get the sense there is an urgency to get this deal over the line by the board as well. My gut feel and I could be wrong (as I have been many times) is that this acquisition will open the last remaining doors to get some of these deals over the line. I really hope management highlight this fact once the deal is complete and can understand why they haven't until it is a formality. I think some others get the impression this is a last ditch effort to buy cash flow when to set up a facility like what Diasource have would most likely take years and 10's of millions of dollars more than what this is costing us.
"Commercial realities resulting from flaws in their original model have ceded any control they had over timely decision making."
Whilst the original plan may not have worked (platform incorporation) I think you will find the new one is but still in the early stages. It also comes at a time when the bio space is looking towards miniaturization and handheld POC devices. As stated before this is the core of our value proposition and this industry trend will actually move these guys in our direction. I have now found 2 companies whom for 8+ years have been trying to commercialize a hand held device but cannot get the results and consistency required. One of those is POC1.
"This to me was reinforced by the share issue and lack of gunpowder in controlling it to their satisfaction."
I really do not think that is true. My view is that the company wanted to offer all shareholders the opportunity to top up in a year which has been touted as the transformational year by Geoff and Mark Bouris. If they really had a lack of gun powder they would have gone straight to Patterson's or the like a touted a CR at a discount which would be sold on market for a 10% gain as soon as possible. Instead only the left overs go to a underwriter / sub underwriter in the event there are left overs.
Do get me wrong, there are risks and I have highlighted them in another post so wont rehash here. I also think it will take another year before we will see multi millions in revenue outside of Diasource but the market will have already started to price that in when some of these guys sign on IMO.
ADO Price at posting:
7.8¢ Sentiment: Buy Disclosure: Held
