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CryoLife Inc. Message Board

  • dlhild@ymail.com dlhild Aug 25, 2013 12:59 AM Flag

    SA's dilemma.

    On the one hand SA is touting PerClot as a high margin large market superior hemostat. "We estimate that the 2014 U.S. market for a powdered hemostatic agent is $1.1 billion, while the European market is estimated to be $430 million in 2014." "We believe that PerClot is a very superior product". etc.

    Also, it appears that CRY owns 2,379,554 shares of Medafor carried at $2,679,000, or about 1.13 per share. It looks like the first payment to Medafor shareholders would be $6.37 per share, later a staged payout of up to $0.71 per share out of escrow, plus up to an additional 2.82 per share if sales targets are met. The potential payout could be as high as $9.90/share, a nice profit for CRY. CRY could certainly buy back some shares with this money.

    SA's dilemma: IMO Steve really does not want BCR to acquire Medafor, because instead of CRY being the "Big Boy" against "Little Boy" Medafor, the game reverses and CRY becomes the "Little Boy" and BCR becomes the "Big Boy". IMO PerClot's value could possibly be headed toward near ZERO if BCR were to acquire Medafor. So IMO SA really doesn't want this deal to happen. IMO though, if CRY doesn't vote (deemed a no vote) or votes "no" to the deal SA AND CRY's ENTIRE BOARD would be committing a MASSIVE FIDUCIARY VIOLATION by not maximizing the value for CRY's Medafor shares. Could CRY be setting itself up for a shareholder lawsuits on three fronts: 1) Understating the value of Medafor shares on CRY's financials; 2) Not disclosing the litigation risks of PerClot until the last quarterly financial statements; and 3) not maximizing shareholder value for the 2,379,554 shares of Medafor stock.

    SO CRY BOARD, YOU GUYS ARE ON THE FRONT LINE OF HONESTY, INTEGRITY, AND FIDUCIARY RESPONSIBILITY. WHAT IS IT GOING TO BE GUYS..?

    So, IMO SA has a dilemma.

    These are just my opinions. I'm not an expert on any of this. Do your own due diligence. Who knows what the final outcome will be.

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    • I don't think there is any kind of dilemma here at all. I'd give the merger at least an 80% of going through. ( The main reason for it not going through would be if Bard finds out something negative about Medafor during their due diligence.)
      The positive is it looks like CRY will get a sizable payoff on what looked like a very bad investment. What it also does is validate powered Hemostats.
      The negative is there is another large competitor. However, CRY has been competing with JNJ and other big boys for years. I also believe that CRY has a far superior product in Perclot than Medafor's product.

 
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