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Guilford Pharmaceuticals (GLFD) Message Board

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  • fwb54 fwb54 Jul 21, 2005 10:12 AM Flag

    Biopicker should I short now?

    Does the 15% collar mean the stock portion of the buyout can go up or down 15% or what? what is the downside risk?
    Does the buyout have a penalty or could someone else bid for Guilford, ie are we in play?
    Anybody know these answers?
    Thanks

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    • thrill_seeking_billionaire thrill_seeking_billionaire Jul 21, 2005 10:15 AM Flag

      I'm Guessing its TIED to MOGN shareprice.

      ASSUMPTION is if MOGN falls before the deal closes MOGN will issue up to 15% to keep the deal on par with the $3.75.

      Nice COLLAR

      MOGN is trading nicely today too

      Looks ok

      As a Small time holder to hold until the deal closes for .10 isn't worth the wait IMO.

      Hence there will be a cap between $3.55 & $3.65 IMO

      TC

      • 1 Reply to thrill_seeking_billionaire
      • From the MOGN press release.

        "The stock portion of this consideration is subject to a collar such, as determined over a certain five day period prior to closing of the merger, that Guilford shareholders will receive total consideration of $3.75 per share, consisting of a fractional share of MGI PHARMA common stock worth $2.625 plus $1.125 in cash, if MGI PHARMA's common stock price increases or decreases by less than 15% prior to the close of this transaction. If the average closing price of MGI PHARMA common stock is equal to or more than $31.71, each share of Guilford will be exchanged for 0.0828 of a share of MGI PHARMA stock plus $1.125 in cash. If the average closing price of MGI PHARMA stock is equal to or less than $23.43, each share of Guilford will be exchanged for 0.1120 of a share of MGI PHARMA stock plus $1.125 in cash."