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Rexahn Pharmaceuticals, Inc. Message Board

ofir_menkes 104 posts  |  Last Activity: Mar 27, 2015 11:26 AM Member since: Jul 27, 2008
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  • ofir_menkes ofir_menkes Mar 27, 2015 11:26 AM Flag

    Nobody is missing it. the cashflow should be stable for the next 7 quarters and their debt is now about
    $1.05B and their capex should be about equal to their cashflow for the next year. the big question is
    what will happen with oil in 2+ years. I personally think that oil will be in a profitable price for LPI.
    Time will tell. good luck.

  • Reply to

    Insightec ExAblate

    by kodakbond Mar 19, 2015 9:55 PM
    ofir_menkes ofir_menkes Mar 24, 2015 4:51 PM Flag

    I guess this is one way of looking on it... If you zero out the value of EPI, you ignore the
    part into which the company put over $75M (50% of $150M) about 7 years ago and
    should be worth much more today, you might be right.
    Gamida cell is about $35M in return of shareholder's loan to Elbit if it is bought + 87% of
    what stays in Elbit Medical.

  • Reply to

    EXXI Private Offering of $1.45 Billion - COOL!!!

    by aw_beerman Mar 13, 2015 3:25 PM
    ofir_menkes ofir_menkes Mar 13, 2015 4:31 PM Flag

    You do realize that this debt is secured, so it gets the unsecured bond holders farther down. it might pave
    the way later to convert unsecured bonds into shares in order to reduce the debt.
    The question will be at what share price it will happen.
    I am not short, but it is too risky for me. good luck and hope for you the company manages to postpone
    dilution until the share price recovers.

  • ofir_menkes ofir_menkes Mar 3, 2015 11:06 AM Flag

    Yes, but the vast majority of the value is in Australia & Canada. the u.s mi has so little
    value right now compared to the others. the only way to destroy the value, would be to
    sell more stock in the Canada and Australia companies (public companies, in which
    Genworth is a majority holder) in order to put it in the dark hole of the LTC.
    At this point, the MI holdings are higher than the market value of the company (I assume
    cash at corporate is not much lower than corporate debt...).

  • ofir_menkes ofir_menkes Mar 3, 2015 10:00 AM Flag

    Genworth's long term care policies were the best bargain for a long time - it was idiotic of Genworth to
    price them as low as they did. that part of the business of Genworth is worthless. the value is in the
    mortgage insurance.
    As far as the policies in place - I doubt your customers will find much value somewhere else (I assume
    these are not people less than 35 in age).

  • Reply to


    by dubi_calmy Mar 1, 2015 9:16 AM
    ofir_menkes ofir_menkes Mar 2, 2015 2:27 PM Flag

    Lets update it:
    Sector 1: owning 45% of Plaza Centers, who owns 5 active malls which secure mortgages and have
    over 70M Euro in excess equity. the company has bonds of ~200M Euro, 4 active projects and more
    "non core" parcels (probably for sale...). largest project is Casa Radio in Bucharest, where 115M Euro
    have been invested. the company believes phase 1 (large mall and offices) could be finished in 2017.
    Plaza also owns in India 50% of EPI who owns:
    ~100 Acres in Varthur, Bangalore (by Varthur Lake, next to Whitefield - and on the path of the PRR).
    ~90 Acres in Padur, Chennai (a few kilometers off SIPCOT and OMR).
    Some land holding on an Island offshore Kochi.
    One of the active malls is in Pune and a sale agreement was done for it in 2013, but the implementation
    is being postponed and it has a negative ongoing NOI (mall needs to probably be converted).
    that is outside of EPI.
    Sector 2: owning 77% of Radisson Blu Bucharest complex and 100% of Radisson Blu Antwerp.
    Equity value: 25M Euro for Antwerp, 25M Euro for Bucharest.
    Holding 3: owning 50 year lease rights for 10 acres of land on the shore of the sea of galilee (for hotel).
    Holding 4: owning 89% of Elbit medical who owns:
    24% of Gamida Cell - a company who is to be sold to Novartis (pending milestones that should be
    reached in 2015) for $200M plus $435M of future milestone payments.
    33% of Insightec - a pioneer in combining MRI and ultrasound to target and heat inside the body in a non
    invasive way. last round of investment was at $200M before the $62.5M investment.
    Elbit medical has no liabilities outside of shareholder's loans from elbit imaging.
    Holding 5: 50% of EPI owned directly.
    1. ~$35M loan from Bank Hapohalim.
    2. 670M NIS of bonds (~$170M), due in 2019 & 2022. they are at Israeli CPI + 6%/year.

    That is the company to the best of my knowledge. current market value is $40M for the equity.
    good luck to the company.

  • ofir_menkes ofir_menkes Feb 25, 2015 1:15 PM Flag

    Joe, they are in the real estate business and they are working on getting out of there. in order to do
    that they need to sell and in order to get a good price they need to be smart.
    The Bucharest complex is worth a lot of money and in order to maximize its value for Elbit's
    shareholders they need to do this.
    Like it or not, the equity in the Antwerp hotels and in Bucharest should be worth a lot for Elbit.
    Given time that money will pay for the Bank Hapohalim's debt and some of the bonds
    (prepayment using 75% of money left after paying the bank).
    Good luck to the company and to us, its shareholders.

  • Reply to

    Question for shorts -

    by ofir_menkes Feb 10, 2015 6:12 PM
    ofir_menkes ofir_menkes Feb 25, 2015 11:43 AM Flag

    Lets wait and see what happens, instead of trying to guess. the shorts could
    get burned, but they are willing to take that chance.
    I have never been a huge fan of companies like this one (built on the knowledge
    and experience in trading of family members who control the company), but I
    believe that this is a real company with real profits.
    Disclosure: long (probably for the next two years).
    Since I believe this company is for real, I also think that organic growth like in
    here will be rewarded in a world of declining growth in most sectors. it will take
    time, but it will happen.

  • ofir_menkes ofir_menkes Feb 23, 2015 10:56 AM Flag

    Years ago I was in your position (beginner's luck). EXXI has close to $4B of debt. in a good year it produces
    close to $0.8B of cashflow and it has a growth capex of $0.5B plus 6% cost of debt (~$0.24B).
    Add dividend and you will see not much money is left to reduce debt. lets assume their hedges will give
    them ~$1B if they were to monetize them today. they still have $3B debt left.
    The problem with carrying so much debt is not only the amount, but also the terms. with bank debt (and even
    with bonds post 2009) you have many tests and breaking those tests exposes you to a risk.
    You might be right about EXXI, but you are paying $400M for an option on oil prices going over the next two
    years to over 80. I think it will, but this is still an expensive option.
    I would rather invest in less people with more breathing room who will be the buyers of distressed assets
    (when capitulation will come - and it will come).
    Anyway, good luck to you.

  • Making the shares of the complex delist from Romania is a step towards taking over 100% of the project
    (now they own 77%). in the past Elbit claimed that the hotel complex is worth a lot more than its debt
    (total of 10M Euro in 2014 and more in 2015 and it has potential
    for improvement (upgrading the part that is only 3 stars now - partially done in 2014).
    Lets hope for the best. the total value should be easily 120M Euro as is ( 50M Euro equity).
    Market value was representing of enterprise value

  • ofir_menkes by ofir_menkes Feb 10, 2015 6:12 PM Flag

    Fidelity (FMR) owns 12% of the company. do you think they never looked at the certified financial statement?
    The company pays income tax ($3.7M in q2-3 2014, to be exact). the auditors who certify the books have
    to verify with the IRS (or the Indian equivalent) that the money was paid. would anyone pay taxes on non
    existing profits? where would the money come from?
    Usually a sign of fraud is when a company makes money, but yet does not owe taxes. here those tax
    payments are actual payments. they are easily verified.
    Revenue verification - an elemental part of the audit that they have to pass to have certified financial
    By the way, their current interest expense is running at close to $30M/year. once they do the bond deal, they
    will pay less than the 13% they are now paying (about what is expected from financing in India - especially
    in rupees). if they paid 8%, they would have had $10M more of profits (annual per tax).
    Just an FYI.

  • ofir_menkes ofir_menkes Feb 10, 2015 3:17 PM Flag

    Look at the scheduled off hire prices in 2015. the revenues will be down in 2015, but there is a light at the
    end of the tunnel. the large backlog of new deliveries is mostly over in 2015 and from that point on the
    pricing should move more than slightly (box volume goes up in 2016 by 6-7%, new del. less than 4%,
    scrapping at 2% = 4% less capacity, finally).
    Lease revenue:
    2014 = $203,000/day
    2015 = $152,000/day (my guess based on lloyds list numbers).
    The 152,000/day could be revised upwards quickly or downwards quickly.
    projected revenues in q1 2015: $150,000/day x 91 days (per quarter) = $13.5M
    projected amortization of prepaid expenses = -$3.0M
    projected operating expenses = -$6.0M
    projected administrative expenses = -$1.5M
    projected interest expense = -$1.7M
    projected depreciation =-$2.6M
    bottom line: =-$2.3M
    This is based on very recent charter rates. and I take an off hire during 2015 as 1/1/2015, so the
    reduction in the leasing revenue will be gradual and if rates stabilize higher this year, the projection
    will change (probably upwards from $150,000/day which is very low - includes operating expenses).
    Good luck to the company.

  • Reply to

    Gamida cell NEWS

    by dubi_calmy Jan 8, 2015 11:59 AM
    ofir_menkes ofir_menkes Jan 9, 2015 7:04 AM Flag

    Since this trial is only for 20 patients, it is a good indication for the possibility. it will be up
    to Novartis to show a quantifiable efficacy in a phase 3 (hopefully, if they do use their
    option to buy Gamida Cell this year).
    Once the option is used by Novartis, that means about 12-15% buyout at par of the
    company's bonds (and Bank Hapohalim - not sure) at Par.

  • Reply to


    by starteam003 Jan 7, 2015 7:10 AM
    ofir_menkes ofir_menkes Jan 8, 2015 10:47 AM Flag

    The article is weird. the Pune mall belongs to Plaza, not to EPI.
    The Thiruvananthapuram holding belongs to Plaza, not EPI. it is not even mentioned any more
    at the Plaza asset list, so it is weird.
    The Kochi land is actually a small part of a 40 acre land that is actually on one of the islands by
    Marine drive. until the island finally have a bridge, it is not worth much...
    The Chennai land was worth close to 5 crore / acre on 2010. 75 acres (approved for building) x
    5 acres should have been 375 crore back then. values increased since then.
    Chennai cost was $38M in 2007.
    The Chennai land is 75% owned equally by Plaza and Elbit. the former initiator of the transaction
    has an option to buy 5% at cost plus LIBOR+ 2 (per year, going back to 2007).
    The Bangalore land was purchased for close to $90M at 2008. it was composed of 54 acres for
    over $50M (back in 2007) and a loan of over $41M for the purchase of 51 more acres by the
    partner (Mantri developers). $93M back then is 550 crore. since then that price should have gone
    up in the area by a lot (especially with the peripheral ring road finally starting and the rail
    connection coming to whitefield in 2019).
    The Bangalore land is 95% owned equally by Plaza and Elbit. the former initiator of the transaction
    has an option to buy 5% at cost plus LIBOR+ 2 (per year, going back to 2007).
    As I said, the Bangalore land by itself should be worth ~1000 crore.
    Anyway, only my 2 cents.
    By the way, Gamida Cell just had news yesterday that they showed that Nicord could be
    effectively transplanted after being frozen. that would reduce logistics costs and complexisity
    by a lot.
    Good luck to the company and to us, its shareholders.

  • Reply to


    by starteam003 Dec 9, 2014 9:17 PM
    ofir_menkes ofir_menkes Dec 10, 2014 3:35 PM Flag

    You do realize he is no longer in the company, right?
    Start looking at the assets and I think you will find that over the next 5 years the company should
    be able to rather easily pay back all its liabilities (probably way less with prepayments of the
    As I told you before, I think Zisser was too smart for his own good too many times in his life.
    I believe that a good deal is a deal good for both sides, Zisser strikes me as a person who
    believed that a deal good for him is a good deal regardless of the other party.

  • Reply to


    by jo.ster Dec 1, 2014 3:47 PM
    ofir_menkes ofir_menkes Dec 9, 2014 7:04 PM Flag

    So what happens if and when Gamida cell finish their phase I/II (which should trigger the Novartis
    buying of the equity for total of $165M - 24% to Elbit Medical which would cover the shareholder
    loan to Imaging, which is $35M)? that would trigger 75% (~100M NIS) prepayment of bonds
    (not secured against Bank Hapohalim - only against the bonds). if that happens future payments
    could get up to $435M more (24% to Medical which is 89% owned by Imaging) over the next
    so many years (depending on clinical trial progress and sales later - if will get to that).
    Insightec (by value of last round) was valued at $200M pre money or $262.5 after. Medical owns
    ~33% fully diluted (assume sales do not reach $60M for 2014-2015).
    I have not valued the hotels (I assume 60M Euro equity), the 35M NIS due for the silly fashion
    stores. Tiberias land value is a good question.
    Plaza centers will continue to reduce debt and another question is about the India lands.
    In case the company goes private, they will have to pay full payment for the bonds and to Bank
    I do not have any illusions about convincing anyone, but I do wish to set the record straight
    about the economic value of this company (regardless of end of the year tax selling season).

  • ofir_menkes ofir_menkes Dec 9, 2014 6:40 PM Flag

    I thought Elbit remained as an independent company that got absorbed into
    Elron after it spun off the Imaging (elscint) and systems. Elbit vision was a
    later creation. I remember Uzia Galil's vision with Elron.
    The irony is that only now things like Pill cam are really being monetized...
    Anyway, it is a shame how people with vision are replaced with people with
    excel spreadsheets...
    Just a side note - the bond 9 at less than 60 is quite the thing to buy and put
    to the side. only my opinion. good luck to the company and us at 2015.
    God knows tax selling season is creating a very low benchmark for the

  • Reply to

    Note to Eduardo

    by jvkla Nov 18, 2014 9:01 AM
    ofir_menkes ofir_menkes Nov 18, 2014 1:18 PM Flag

    And you do remember that the debts of both Plaza and Elbit are predominantly in Shekels and their assets
    are in dollars and Euros?
    In Elbit's case the debt (direct debt - not mortgages) is 666M NIS in bonds plus $48M to Bank
    Hapohalim. between 35M NIS for the stores and 9M Euro from Park Plaza (from the 2012 sale of their
    hotels), the Bank loan should go down to less than $30M. the equity in Antwerp alone is more than that...
    For Plaza the effect is more dramatic (close to 1B NIS of bonds and all the assets are in Euros and dollars).

  • Reply to

    Note to Eduardo

    by jvkla Nov 18, 2014 9:01 AM
    ofir_menkes ofir_menkes Nov 18, 2014 12:40 PM Flag

    This company was always and will always be an event driven company. liquidity event means better
    prospects. people will be shorting or going long, but at the end of the day comes the actual value.
    Potential events:
    1. Hotels - selling the Bucharest of Antwerp hotels or the land in the Galilee. each of the two hotels has
    mortgages, but the equity value is much higher than the obligation.
    2. 2015 - Gamida cell - if the Nicord milestone results are met (look to be heading there based on results
    so far - as of August), Elbit Medical will get 30.7% of $165M. Elbit Medical owes Elbit Imaging $35M in
    shareholder's loan. Imaging also owns 89% of Medical. Medical also owns a slice of Insightec.
    Gamida cell option to NOvartis is until 1H 2016.
    3. Receipt of 9M Euro from Plaza Park - to be paid to Bank Hapohalim to reduce its loan there.
    4. India land - would a project in Chennai begin in 2015? Imaging owns 40% of 83 acres which are worth
    a lot. Bangalore (25% of 165 acres) is a more complex deal.
    5. Plaza centers - finishing the rights issue (in which Elbit Imaging will contribute ~13M Euro) should
    enable Plaza to start and look for financing partners for the shorter term projects (Casa Radio phase I,
    Belgrade old city hotel & commercial project, Lodz Residential - depending on market, Lodz Plaza etc.).
    Anyway, I do not know the technicalities of stocks. I do know value and usually value wins over time.
    People who short here might wake up one day to find a liquidity event happened and a decent chunk of
    debt will be soon gone. in such a case, I do not envy these guys.
    Like I said, what do I know. been there before and will be in the future...

  • ofir_menkes ofir_menkes Oct 28, 2014 6:47 PM Flag

    I do not know the exact number, but I will repeat what I think the components are worth:
    Antwerp Hotel (8M Euro EBITDA in 2013, assume same in 2014) should be worth close
    to 80M Euro (again, just a guess). debt against it = 22M Euro. net value ~58M Euro.
    Bucharest hotel (77%) (10M Euro EBITDA in 2013, assume same for 2014) should be
    worth well north of 90M Euro. debt against asset = 64M Euro. net value ~20M Euro.
    Stores will bring in at least 35M NIS. I wonder if more will come from the negotiations
    with the owner of the Mango name (the Spanish company).
    Rights to land by the sea of Galilee - I do not know how much it is worth. 40M NIS were
    invested for the rights to build 650 hotel rooms and vacation apartments on the site.
    that was in 2007, when the real estate in Israel was half of its price today. I am not fully
    aware if this is a desired piece of land or not... 11 acres could be worth a lot there.
    Land in India:
    25% of 165 acres in Bangalore - by Varthur lake at the end of Whitefield. if you assume
    $1.5M/acre in value, this means $60M for Elbit's portion (same for Plaza).
    40% of 83 Acres in Chennai - by SIPCOT. if you assume $1M/acre (which is conservative),
    you get $32M (same value for Plaza).
    I will disregard Kochi 13 acres with ocean front (will take years for development to reach
    Total so far (based on 3.75NIS = $1) = 371M NIS + 35M NIS + 60M NIS (Sea of Galilee)
    + 345M NIS (India land - Conservative) = 810M NIS. total debt is 850M NIS (and is
    not dollar based, so will shrink in dollar terms as the dollar appreciates...).
    Elbit Medical has a $35M shareholder's loan to be paid (hopefully with Gamida cell's
    sale down payment by Novartis in 2015 - not a closed deal).
    85% of Elbit Medical will remain Elbit's (through which it has 33% of Insightec - the big
    promise). value = $100M.
    55% of Plaza Centers (after all said and done - right issue and such) should be worth
    more than 100M Euro over time.
    Complicated answer, sorry.

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