Wolf-It's all about the legal position. Orbi is owed a lot of...

Wolf-It's all about the legal position. Orbi is owed a lot of money as is Amgen and Sanofi. There are several other creditors with large claims. Amgen, Hikma and Sanofi, and perhaps MedImmune, have certain rights to Unilife's products that result in an effective royalty free license to use the patents and to sub-license. With this as background they must show the court that they are trying to sell the Company or its parts and assets to give the shareholders and unsecured creditors an opportunity to recover a portion of the proceeds. They also know that this will be impossible but it is a legal show.

Once they can't recover anything substantial from a sale, from a legal standpoint it will be clear for the secured creditors to seize the assets and then sell them for whatever they can recover without regard to the unsecured creditors and the shareholders. Which is also why Orbi is willing to put up another $7.5 million during the process. The outcome is inevitable and cleaner going through bankruptcy then it is by just seizing assets and facing a lot of follow up litigation.

As an aside, you believe the assets have value. Remember that in the 16 years Unilife has been in business they have not proven that any of the products they developed could be mass produced. Nor have they proven that any customer would actually use them or pay for them. They have contracts that they have not fulfilled and the WI may be just another product that nobody will use or that can't be mass produced. Their history of failures far exceeds their history of success. Lastly, ten years is a lifetime to a firm like Orbi. Markets change, competition changes, anything can happen in the world to negate the value of a product.

Hope this answers your question.