Rerate versus Takeover .................................................................................................So it seems that corporate transaction has been delayed at least for three months : September 2021 instead of june 2021. If any Covid delays are added, we are in Q1 2022.
These apparently are not a very good news and we should see the share price retrace to 7 c. or less.
BUT,
But, this is not the same 4DS as we knew in 2018 and 2019, with all ups and downs, and succession of hope and despair.
Things has changed since the beginning of the year.
What should have ended in january 2020 has been delayed for more than one year. The company rised double the amount of money needed. And more importantly we had those huge moves in september with 100 millions shares beeing traded on a single day for no reason.
In other words, for the first time of it's history, 4DS Memory showed control movements.
That was visible, in the share price/volume, in the form of the CR and SPP (phone campaign), in the evident will of the board to pump the price (first time in the history of the company),
and, if I may dare say, the less convincing stories about technical challenges.
Looking from a distance at what happened since the beginning of the year , one have the gut feeling that the scientific and technical challenges are not the most important part of the story now.
May be it is not completly solved, but the technical results are convincing enough for corporate strategist to take command.
There are huge strategical movements that are beeing planed in the semiconductor industry. And those movements are also witnessing delays.
For exemple, the Kioxia IPO that was supposed to take place in august, was postponed to december and finaly Kioxia may be allowed to list 10% of its capital in february 2021 the real IPO beeing posponed to... Q4 2021. Just when the 4DS Mbit chip will be ready to be produced in a factory..
The buying of 4DS by Kioxya would be logical. Kioxia and WDC are sharing Fabs in Japan and one of them is totaly new and could accomodate new equipments to produce a ReRam chip.
Kioxia - formerly Toshiba Memory - was sold by Toshiba Corporation to pay for the losses in the nuclear branch (Westinghouse).
WDC tried to buy it but Toshiba Memory was finaly sold to a special purpose company led by Bain Capital.
SK Hinix and Apple are also behind Bain capital.
https://asia.nikkei.com/Business/Companies/Japan-s-Kioxia-plans-October-IPO-to-fill-war-chest-for-5G-eraThe money to be rised through the IPO will be used to open up to three new factories in japan.
This is to stay at Samsung investment level. Samsun is restarting its industrial expansion in China and have huge ambitions.
There are no proof of that, but it would be logical to think that the tiny 4DS - probably with other startups and innovators - has a role to play in this great microchips war - one reason beeing that a lot of money is at play and 4DS will cost some money.
https://inversezone.com/2020/12/09/tse-change-opens-window-for-bain-to-revive-kioxia-ipo/But the microchip war has its own timming wich might not be the one expected by 4DS shareholders.
So one could be justified to think that we are witnessing is more an adaptation to a change in the strategical context, than a technical problem (or may be a bit of both : corporate negociation delays beeing exploited to progress on the technical side).
Key ideasOne thing seems evident now : 4DS does'nt control the timming. In fact one could suggest that it doesn't control anything at the stage. Release of data are on the hand of WDC and the money to pay for a takeover might depends of what is planned by mega companies in the semiconductor field.
The most probable outcome is that 4DS will have to wait until ist's riche industrial partners are ready to make a move.
This situation might be frustrating for those who have put all their hopes in a takeover or a merger.
This kind of transaction could be more than twelve month away.
But things have changed for 4DS, and time could very well be a friend now. Every week and month that pass, the strategical and technical context become clearer for analyst and technical media. Each day and week, the potential of 4DS becomes more evident.
So, a corporate transaction ?
We might not see it in 2021.
But a prolonged rerate is certainly in the cards.
This is only a non professional opinion. NO FINANCIAL ADVICE.
