OK - here is what I am thinking - PIP is now part of Theraclone - so basically the "shares" they used to merge is now part of a new company ... Let's say this new company remains with the name Theraclone, and PIP's stock symboy now becomes TCLO or something like that ... the point is this new company really did not dilute shares, they just, "pushed the poop" as accountants like to say into the new company. So, 50 shares that were once PIP is now 25 shares of PIP and 25 shares of Theraclone or ... 50 shares of TCLO. So I am not getting the dilution argument - but what I am afraid of is if Theraclone does have a #$%$ balance sheet and PIP will have to invest real $$$ in keeping them afloat.
Oy vey, where to begin? This is a PROPOSAL, not a DONE DEAL...folks like MPM could probably torpedo it, but very much I doubt Richman would have done the announcement without first counting obvious votes. They already said the combined company would be called PharmAthene, PIP would be the ticker, and Clifford Stocks would be the CEO (everyone with a stake here owes it to themselves to listen to the CC). I've been very happy with Richman as CEO, but Stocks is perfect - much experience in selling little pharma to big pharma. There is no dilution argument, other than the obvious 50M or so shares of PIP that will presumably be printed from the shelf reg, then distributed to the former Theraclone owners in exchange for, um, Theraclone. We're getting a non-governmentally dependent pipeline (which nonetheless has BARDA-worthy items) in exchange for ABSURDLY UNDERVALUED STOCK. And a CEO who has already done what the combined company will need to do. This is a way better idea than any I'd have come up with...basically means Ron Perelman will have to pay more to get 100% of Arestvyr profits back under the M&F roof, but maybe the "more" is actually now worth it to him...time will tell...I'm cool with shorts getting squeezed like Ackman meat in a Icahn/Soros sandwich, but then again, that's what I always say!
NM - I suppose they will have to issue new shares to give to Thermacore's VCs. It looks like Theraclone is confident in the verdict and it looks like their balance sheet is ok (6M debt, but 20M in cash), so in the end for PIP investors ... time will tell.
No vote if merger is causing a big hair cut in share prices. Shall vote for the merger if share price is higher after announcement, not after???? The crooks may want to drive down the share prices before their merger as the executives get their options; more shares per $$.