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CryoLife Inc. Message Board

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  • dlhild Jun 6, 2010 4:23 PM Flag

    Today's Legal News on Cryolife vs. Mefafor

    CRY wants to outright own Medafor. Hence, CRY started this litigation, because they hope to force Medafor shareholders to sell to them because of liquidity issues. CRY is the one not following the contract. They are using this as another technique to impact Medafor's cash flow. Medafor would gladly follow the contract, but that does not fit with CRY's takeover tactics. Think about it logically. If you were the big bully, and you wanted to beat up (takeover) the little kid, would you follow the contract if you thought that it may impact Medafor's cash flow to the point where the shareholder's would then have to sell to you. No, CRY is the dirty rotten apple here, and they are using a whole series of disruptive techniques. Medafor would be glad to follow the contract, but that is not CRY's takeover game plan. Medafor is way to small to be stupid enough to pick this fight just for the fun of it. CRY is playing a passive agressive role. Talk nice, but be a mean rotten SOB where the rubber meets the road.

    According to my projections, which are based simply on junior high math, I think CRY is projecting HemoStase sales roughly in the range of the following numbers. 2010 sales of around $10-$12 million. 2011 sales around $22 million. 2012 sales around $34 million. 2013 sales around $45. Cry sees so much value in Medafor, that they are absolutely determined to take over Medafor. Medafor, on the other hand, is absolutely determined to stay independent...unless a FVM offer was made.

    Bottomline: CRY is the contract breaker here, because it is their tradegy...this puts it in plain English.

    If CRY doesn't acquire Medafor, their sales will fall off a cliff in 2014 forward, because as of may 2014, they can no longer sell HemoStase.

    This is going to go from bad now to much worse, because CRY is trying to win via a damage your takeover targets cash flow by any means possible. Also, at least presently, CRY does not think that any damage award would be that great, but that could chage dramatically too.

    When comments were made about the size of the bond that Medafor requested, take 30% times the above sales, and the high dollar bond request may staart to make some sense.

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