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Columbia Laboratories Inc. Message Board

  • koleminer1 koleminer1 Sep 12, 2013 4:15 PM Flag

    Some Other Miscellaneous Info and Musings

    While this may be a good deal, I have to admit that I was disappointed with the share price decline - especially given relatively thin trading (don't know whether 3 X normal volume warrants a 10% drop).

    I wrote to Frank with some concerns that the language and data in the press release were potentially confusing (for one, other people have made related remarks about ~ $400K annual earnings for a $25 million investment etc.). I was confused on the first quick read.

    They will consider how they might address such potential confusion.

    Based on subsequent "out of office replies", Frank and Jonathan are both out of the country for the next week or so - if there is anything to read into such circumstances after wrapping up a major deal. I hope it's not to take a vacation.

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    • You will see the stock under $7.00 before you see it back to $8.00 and if we have a market drop(which I think we will see next week , then we could see low 6's, people and smart money don't trust the deal or the management

    • 400K does not represent MPs annual EPS. The 400K represents "cost synergies" (cash savings via operational cost reductions realized by the combined entities. The price of the acquisition was 10-11 X MP EBITDA and immediately "accretive" to CBRX EPS.

      Without getting into excessive detail, suffice it to say that the acquisition was/is an excellent move by Columbia management on several fronts.

      In addition to gaining MPs business model and depth of expertise at a reasonable price, the overhang of what could have been a "potentially" HIGH RISK, HIGHLY DILUTIVE type acquisition is NOW REMOVED!

      This deal very much reminds me of when QCOR acquired their contract manufacturer (the street loved it as well) as well as the emphasis on "minimizing transaction costs & dilutive effect on the share price".

      Hence the bounce back intraday after the news was fully analyzed and digested.

      Koufax.

    • I also wondered whether the acquisition might give CBRX the ability to "engineer" Crinone according to a woman's unique circumstances. The skills and technologies might also mitigate the concerns and risks of and with compounders who have operated in this space. From a marketing perspective ~ "absolutely certain that this is the GOOD STUFF that YOU need".

 
CBRX
6.24+0.01(+0.16%)Jul 28 4:00 PMEDT

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