UNS (ASX) Buy out?

Originally posted by Keffola ↑

Some of what you say does makes a little sense, but I don't think your conclusions are necessarily "reasonable". It seems like there's a lot of contradictions!

For example you state early on:

"For the record, I don't think Amgen wants to take a strategic stake in UNS and they definitely don't want to buy it."

Yet your final conclusion for Amgen's perspective is that:

"The solution for Amgen is a strategic stake in UNS. It is easy for them, they just have to monitor the company and crack a few heads when UNS steps out of line."

So in your opinion do they want a stake or don't they?????

Further on, you say that UNS don't want this a stake by Amgen in UNS will kill all growth opportunities. Can you explain why and how?

Afaik the % of UNS that Amgen are looking to aquire is 19.9%, which does not get them a board seat? So while Amgen will want their interests looked after, ultimately they won't be making any decisions for unilife? I don't deny that a partnership with Amgen may make deals with other pharma's potentially more difficult, but to say kill all growth opportunites is surely a hyperbole? And what about growth opportunities with Amgen products?!

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Fair point. I worded it poorly.

I don't think Amgen wants either, but a strategic stake is far easier than a buy out. What they would really like is for UNS to get their proverbial together, so they could be confident of supply going forward without having to do anything. I am guessing, however, that they don't see that happening without significant intervention.

A shareholding doesn't entitle you to a board seat (unless you take the company over), but you are likely to be able to vote directors in. In most cases, if a major shareholder asks for a seat, they will be given one. An angry holder with even 10% of a company's stock can cause a company a tremendous amount of grief. Easier just to make them feel included.

My line was really about what Amgen would want, not a lower limit on what they would agree to. At a minimum, they would demand very, very tight control on expenditure, principally R&D.

Agreed, you would get growth from Amgen products.

It is always possible that another player may emerge, creating some competitive tension. If that were the case, though, UNS wouldn't have extended the agreement with Amgen or they would have charged them a motza to extend it.