Since you and I are on @The Yankee's ignore list, it is unlikely that we will get a reply from him, unless he secretly put people on and off his ignore list again.
Considering that his argument for buying high and selling low is a little bit misguided to say the least, it is quite incredible that in just a few hours, his post managed to get 17 thumb ups and still counting.
This demonstrates the very dangerous confirmation bias in action among MSB holders. Whether or not a message is true or not, is not important. As long as it confirms one's prior belief/position, it must be correct.
My guess is, last December, MNK was the only company that was willing to offer MSB some cash in return for some exclusive period to do a deal. There was simply no bidding pressure amongst the potential partners.
Had MSB got an offer whose terms and conditions are exactly the same as those with MNK, from someone with more credibility like Celgene, I can guess with confidence which party MSB would have chosen.
Whether or not MSB and MNK will end up doing a deal, I have no idea. One thing for sure, before end of March, MSB will have to announce something on the funding front again. The cash they got from MNK would have been used by then, and they will need to raise more money again. These are the options:
- Equity raising from existing shareholders (unlikely)
- Kentgrove equity financing facility (possible)
- Another temporary deal with MNK or a new party to buy another quarter or two of time (likely)
- Comprehensive deal with MNK or a new party, involving capital injection in MSB in the region of hundreds of millions of dollars, done at a premium to prevailing share price. (possible)
Whatever form it is, the number of shares on issue will certainly rise again from the current level of 401.6 million. And with every rise in the number of shares, the target price of $10 or $100 of some posters, will become that little bit harder to achieve.
MNK has the luxury of time to put more pressure on MSB during the negotiation and unfortunately for MSB, it doesn't have the same luxury. As we know, MNK has 9 months to do a deal, while MSB only has 3 months before its money runs out. In this kind of unbalanced negotiation, have a guess which party has the upper hand? MNK of course, it can deliberately stall the negotiation so that it can secure more concession from MSB.
In the mean time, MSB doesn't have any room for any kind of bad news at all. With its reputation badly tattered from the Nasdaq debacle and Teva departure, the market will find any excuse to punish MSB if MSB dares to disappoint the market again.
Only these things will secure MSB's future:
- Successful trials
- Product approvals by FDA
- Partnerships which are advantageous to MSB, not just any kind of partnerships.
MSB Price at posting:
$1.58 Sentiment: Sell Disclosure: Not Held
(20min delay)