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Insmed Incorporated Message Board

  • fudfighter4 fudfighter4 Jul 16, 2013 4:47 AM Flag

    We pay his salary - but who is he working for?

    A share offering at this point was completely unnecessary. Even at the high end of the projected burn rate the Company wouldn't have needed to tap the cash raised in the last offering until Q1 or Q2 2014.

    1. Share offering October 1 2012

    Price - $4.07

    Dilution - 20%

    Amount raised - $27.7 million

    2. Share offering July 15 2013

    Price - $10.81

    Dilution - 19.9%

    Amount raised - $69 million

    Total raised - $96.7 million.

    Here's how a CEO not in the pockets of institutional investors might have played it -

    1. Share offering July 15 2013

    Price - $10.81

    Dilution - 19.9%

    Amount raised - $69 million

    2. Share offering Q2 2014

    Price - $50

    Dilution 19.9%

    Amount raised - $319 million

    Total raised - $388 million.

    Assuming we actually need that much cash before regulatory approval of Arikace, for the same degree of dilution we would probably have had an additional $290 million in the Company coffers.

    As it is, imo Lewis already intends to dilute us a third time before Arikace receives regulatory approval.

    But even so, he could easily have delayed this latest offering until the end of the year, and fitted in a third if needed before the commercialisation roll-out.

    It was beyond reasonable doubt last October that the share price was likely to be considerably higher than $4.07 by Q2 2013.

    It was beyond reasonable doubt from the moment Arikace succeeded at Phase III that the share price was likely to be well over $20 by the end of this year.

    What's the LOWEST valuation of the Company suggested by the recent analyst upgrades? What excuse can Lewis possibly have for issuing shares at a price so far below the valuations of the analysts?

 
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