Foundations of Value (deuxième partie)

I have not added to the cacophony lately, preferring to allow Anteo to give some account of their actions. Which, it appears, they now have, although not perhaps to the satisfaction of this divers audience. Yet it would seem now time to pull out a few thoughts that have been partially developed these past few days. I am not going to quote chapter and verse but just plow on through my observations :

1a) What is the value of Anteo ? This has changed. The Anteo which we knew a year ago is not the Anteo of today. It really is a different company. It now has, perhaps for the first time, a base value which is real because there are real products (products manufactured, FDA and ISO approved, distributed and sold on a regular and increasing basis), real estate (the manufacturing plant in Belgium), real budget (one based on manufacturing and sales of manufactured goods), real profit, and a real value, Diasource having been bought and sold. This value is €23million (if I understood everything correctly during these past half year) which in Aus Dollars at today’s rate is $35million AUS. I’ve lost exact count of current shares but lets say 1 billion. So of todays SP, 3.5 cents is real value of Diasource.
1b) Anteo’s value – last year it was ~$60 to $80 million AUS. Today the market cap of $58M AUS includes the value of Diasource. Can one now merely subtract the $35M of Diasource to arrive at a value for the Anteo only portion of a mere $23M? This would seem an overly extreme devaluation. I cannot guess at the « real » value of the Anteo IP and products introduced during 2015 but for most of 2015, many investors believed it to be in the $70M AUS range. Group think is a powerful tool for estimation of unknowns and group think put it there (SP of about 7cents) prior to the 28cent peak and brought it back after. So I believe real value remains at greater than that which is represented by today’s SP.
2) ISO approved facility in Diasource. Anteo has listed in its strategy that ISO certification is something it wants to pursue. In Diasource, Anteo has acquired an ISO certified facility. THIS IS CRITICAL for de-risking Anteo products particularly in human diagnostics. This has value for Anteo.
3) Anteo states specifically that it wants to use Mix&Go to improve Diasource products. Diasource is, mostly, an ELISA manufacturing company. ELISA technology has largely been replaced by CLIA (chemiluminescent immunoassay) or PCR which are more sensitive, precise and automatable. HOWEVER, Mix&Go will change this and make ELISA better. Mix&Go will (in my estimation) allow ELISA to become much more precise (perhaps an order of magnitude) and at the same time create much more signal through better antibody orientation thus affecting sensitivity quite positively. This has real value. It is – perhaps – one to two years in the making. This process will actually be under Anteo/DiaSource control. Not some third party. This has value.

I think the above have real concrete, controllable, measureable, and marketable value. The merger has shaken up everything and what falls out the other side remains to be discovered. The actions of those managing Anteo/Diasource will affect directly 2016’s endpoint MC based on planned and as yet unrealized profits BUT there is a base value on which to build – now as in the past.

In summary, there is real measureable value in the acquisition of Diasource. There is value in the Anteo only portion. There is commercial value for Anteo and any Anteo customer in ISO certification. There is real CONTROLLABLE value in Mix&Go applied to ELISA products.