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Ann: Sale of DIAsource Settled for Euro 15,873,000 Cash, page-28

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7,131 Posts.

08/09/17

08:03

Post #: 27077682
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Originally posted by Twinvest ↑

At completion of the Diasource sale I am now able to return to any discussions regarding Anteo as all info that we were discussing throughout the blackout was related to the sale process of Diasource.

I will try to put a few points together in this post to detail simply my opinion of current position of Anteo.

First step was ultimately survival of the company and the ability to remain solvent.

This is where we got involved in the loan to the company - This was in alternative to another potential Bergen round which would have imo crushed the company. The director that was working to keep Bergen from being used was Geoff Cumming.

Even though between now and the AGM is about looking forward to the strategy and review of the company, the technology, the partners and where/what is the best way forward it should be noted that although the Diasource business is growing Anteo hardly got the best deal. With Diasource vendor as Anteo CEO and with the size of the earn out there was zero reward/desire to see Anteo tech and partnerships grow and develop. There was major issues with the financing of the transaction as we know and the board has to be accountable.

Diasource was not the reason I or others originally got invested in Anteo - This was about a technology that could be applied as a platform technology for different uses to reduce costs/increase sensitivity / shorten development times etc. - Something that was far from a certainty but trying to allocate capital to develop projects working with companies to try and achieve a commercially viable and disruptive end product.

The last 6 months or so has given me time to reflect on why I initially invested and what were those reasons - Back in early 2011 some of my early research was focused around using the Anteo tech as a coating for beads used in IVD's for immunoassays - Some of the early data was comparing using cheaper beads coated with Anteo tech to make an equivilent or better product than the market leading product. In this example I came across Dynal beads (Life Technologies acquired by Thermo Fisher in 2014) Life Technologies with their Dynal beads were supplying most of the Top 10 IVD companies globally. It was in 2011 that Anteo partnered with Merck to develop a bead coated with Anteo tech.

Just some thoughts on the actual "Mixngo" some I think think this is a finished product that can just be applied across many different surfaces and uses with little development and whalla get your product to market.

The reality is Anteos technology is an enabling tool - for me the best way I have thought about is that each potential customer we have with each different use has a "LOCK" - The lock needs a special custom "KEY" - So each formulation and development time creates a bespoke solution using Anteo tech to make a specific KEY for each customers LOCK. Now this provides a few issues for Anteo and investors as it is hard to communicate as easily the development processes for where progress is at. Some companies it may not be viable to create and develop their "Key" but for the right uses Anteo techs "moat" both makes it harder to crack each company as the value proposition needs to be strong but what it does signal when a company does partner with Anteo that the competitive advantage for Anteo is very high as that individuals companies product for a working commercial success is dependent on Anteos custom created KEY that has made that lock open - One example of this is the 5 year supply agreement with Ellume - Elume is now going through trials and Anteo tech is a vital part of their success. What I mean by this last paragraph is the development timelines are virtually unknown to investors as what company wants other companies to know what they are doing development wise. I guess the point is when partnerships are announced it is a significant journey to get to that point but then we are very secured by the partner.

So now the sale is complete and we are afloat serious thoughts and actions need to take place to assess where the company is headed and why and who is leading the company.

1. Find a highly credentialed suitable CEO

2. Serious consideration over ALL existing board members

3. If you are invested in Anteo for the Anteo technology as part of the future business than Geoff Cumming must be involved in some capacity working with the new CEO to make sure a in depth strategic review takes place of all projects,partners, what worked, what didn't etc - That cant be done if GC insnt involved with the company.

4. Anyone else who has a different direction for the company clearly needs to communicate to shareholders why and what is a viable solution moving forward.

5. I can handle failure to launch on a commercial level - The Bergen financing whilst unfortunate was not my biggest concern. My concern was the "alternatively creative" method of financing used elsewhere - The parties related to this and who introduced them should be gone before AGM. This destroyed the share price. Yes lack of partnerships may have also smashed the share price but the volume of selling that came from the "alternative financing" crushed the company and any chance of finding viable finance/cr solutions.

Anteo now has just over $6m cash in the bank - Annual burn of the Anteo business with no revenues is about $3.5m pa - Anteo will now get the government r&d grant of approx $1.5m pa - Taking annual burn with no rev to $2m per year - This gives a 3 year cash runway - Add to that $1m odd of options due for exercise late 2018. So 3-3.5 years cash with no rev.

Even among the mess that was the last 2 years - Anteo has :

1. 5 Year supply agreement with Ellume for Point of Care device (Johnson and Johnson seem to be keeping them close imo) - With Anteo tech an integral part of their working device.

2. Atomo Diagnostice - Development of a working model for a Tropinin POC device - ($350m USD 2016 market size) - What would be interesting if Anteo ad Atomo develop a better product than the Abbott istat which has 40-50% of the market.

3. DMTC - Planet Innovation /NPLEX

4. Cook Medical - Multiple opportunities for large scale disruption. Projects progressing - Verification study announced Mar 2017

5. Energy market - This requires a lot of capital or a partnership that would develop it. Not to be dismissed

Current mcap of around $20m with $6m in the bank and 3 year cash runway.

Nothing above is advice to buy/sell it is simply my opinion - The AGM this year is very important and any potential resolutions should be thought of ahead of time.

What is needed is a major overhaul and strategic review - No rock or questions should be left unturned.

What I do think is there is a way forward and a future to monetise the technology - The right leaders and strategies must be in place. Investors deserve more and the time is now.

I have enjoyed not posting and felt the need to post the above out of those I respect. But will not be conversing on here as much in future.

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Hey Twin,

Thanks for posting.

I found a CEO & CFO in about 5 mins - maybe if you are still in touch with the powers that be you could get them to think about it -

http://atomodiagnostics.com/company/executive-team/

While we are at it there is a Board that come with them -

http://atomodiagnostics.com/company/governance/

I'm sure I could search Ellume and find a Board and management team - oh yep - there they are -

https://www.ellumehealth.com/about/#BoardMembers

OK - I agree first it would be better to recover some of our MCAP before we back door these guys in but it's just an idea.

As I always said in the past - spill the Boardroom but make sure you have a plan - only one thing worse than a SP in the doldrums and that is no SP at all because you are suspended. Who is on the Board was not clarified in the sale statement so I assume it it RM, RS, JH, AS & GC and that is as good an order as any.

ADO Price at posting: 1.9¢ Sentiment: Hold Disclosure: Held
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