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01/10/19
17:13
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Originally posted by theoc:
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Hi Tuts, seriously, dont burst a phuf-a valve over this just yet. I totally get why it has you worried but suggest you would do well to step back and look at the likely stats and circumstances of your previous experiences. For the record, as a rule I am generally not in favour of conlols unless I can discount the reasons they should not be undertaken. In this particular case I am generally comfortable even though I have no way of being privvy to the driver of timing. Broad statement but in my experience consols are usually undertaken by speci stocks and we all know this is the riskiest part of the market. Unfortunately in a number of cases these consols are employed to try and drum up investment from more sophisticated investors because they have basically run dry in the existing pool of penny players. Poor strategy and generally an unfortunate outcome as they simply build their own cliff to fall off. In this case, by pretty much any measure, we have a savvy bunch of managers and advisors, early stage but very promising science and all in a business that has enough cash to last for quite some time. Apart from the short to medium term science this Co has additional early stage science in an area of science that down the track (in my personal opinion) will be very heavily pursued (so a reasonable plan B). so basically no negative drivers to consol. Currently there are around 11,000 shareholders holding a total of around 3+ "billion" shares. After a 1:10 consol there will still be the same number of shareholders but 0.3+ billion shares so still plenty of opportunity for traders, for LT investors, cornerstone investors etc. I believe that in this case rather than building a cliff (higher share price) to fall off, it will be yet another step towards the development of the business model - be that mid or long term. As with the relatively recent CR we cant and should not know the real basis for the Board taking this (important) decision. Sure this may induce some short term lumps and bumps in the SP but longer term it is all part of building a business model - that is the journey you are part of. My suggestion (personal philosophy only) for what it is worth, is that even if you love the science but (as you are currently indicating ) dont have faith in the management then run for the hills as quickly as you can. Obviously I may well be wrong and this little rocket may never fly but I am confident it wont be because at this point in time they undertook a consol.
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Management is doing ok technically (scientific and clinical management-wise) but with the recent CR (low SP, b4 MS payment, on the eve of data news) and consolidation (on the eve of data news and potentially more MS payments), leaves me scratch my head BIG time about this "business model " you are talking about!
Originally posted by ML173:
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I believe the capital consolidation is also part of the preparation to present us as an attractive clean TO target. Can someone show me any examples of those pharmaceutical giants (Merck, GSK, Pfizer, Norvatis, etc) were ever taken over any penny dreadful biotech ? So just sit back and enjoy the ride to our destination.
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Quote from @ML173 : I believe the capital consolidation is also part of the preparation to present us as an attractive clean TO target. Can someone show me any examples of those pharmaceutical giants (Merck, GSK, Pfizer, Norvatis, etc) were ever taken over any penny dreadful biotech ?"?!?!?! Are you suggesting these "pharmaceutical giants (Merck, GSK, Pfizer, Norvatis, etc)" don't know we exist, who we are or what we do ?!?!?! Maybe they are our "business " partners of the type @theoc is talking about ...
Last edited by
tuts :
01/10/19