I think upside potential is as much as any other biotech from here, but significantly de-risked.
Roche will add significant number of testing which carries 100% reimbursement.
Global marketing through Roche will also increase revenues.
$250 million infusion plus $80 million makes $330 million cash.
$150 million or more for R&D.
Expanded pipeline with liquid biopsy and immuno-pathology,
FMI can open regional central lab and all the specimen being sent from almost anywhere in the world.
They will use Genentech sales force for community education.
Operating expense is low. NO P3 trial which can fail. Minimal number of labs in major area, Fedex will deliver over-night.
First mover advantage is being maximized by Roche deal.
For example, No barrier, no IP in SNS space.
Can ZNGA catch up with FB? Never!
I may hold and see what happens when CMS coverage kicks in.
My wife says I am wrong more often than being right.
I don't know.
I am going to hold all the shares in taxable account for long term tax.
possible tax savings as well as possible gain from here.
Tender offer schedule expected
Starting on 2/1/15.
for 6 weeks likely.
Ending mid Mar.
Proxy vote during yr ending ER in late Feb.
Cash pay out around 3/20/15 if there is no need for extension.
Once you tender your shares, you will not be able to trade those shares in open market unless you withdraw.
How to tender? just call your broker on the phone same day.
How to withdraw? takes a couple of days.
When to tender? No need to hurry. you may wait till last minutes. Wait for CC and decide. Acceptance is pro rated, nor first come first served.
During the last 2 weeks of Dec., 1 million new shorts increased total to 5 million shares.
They tried to feed on fear of year end tax loss selling and in coming secondary.
They are all caught off guard.
Some might have covered. Some might have established new position with the news.
Day traders are almost all gone by now. volume is back down to where it was.
New update will be disseminated on 1/27/15.
High short interest translates into buy interests.
They will certainly suffer more from small float after this transaction is completed.
Technically it will begin with commencement of tender offer.
No guts, no glory???? May be not this case. IMO.
FMI needs Roche to take it to next level.
FMI needed to do secondary @ $20 if it were not Roche deal.
No funding for liquid biopsy and they avoided immunopathology not to compete with Pathologists.
Not enough marketing infra-structures to maximize their first-mover advantages.
Roche is their IP now, raising the bar for smaller start up or ILMA.
The partial buy out is the most sensible approach I can imagine.
Neither Labcorp nor Quest can offer this much for the revenue from selling test and data base.
Only Roche can do this because of their oncology diagnostic and therapeutic program.
Would you be able to think of better possibilities other than Abbott? Unfortunately there was no mentioning about Abbott. I am very happy Roche decided to pay for the first-mover advantages.
Probably less than 10 million shares will be left as float. With high institutional ownership, daily trading vol. can go down below 100k.
$100 is quite possible in view of $5 billion global market.
only 10% of US market has been tapped so far.
The only problem is FMI has gone to far ahead too fast compared to conventional chemo's.
I vote for yes for proxy, but not to tender. All IMO.
Why would you take a risk of Roche to walk away and pps goes back down to 20's?
I always take even money when I have a black jack and the dealer has ace up.
There will be a lot of good hands remaining to be played after this deal.
100% upside from here.
My long term share will mature in June, but I want to hold it till next Jan,16.
I am surprised by active trading activity at this discount price. MM may try to set the tone for tender offer - higher the market price, lesser the tender for $50. If initial tender yields less than 50%, they have to extend the period and insiders may have to tender their shares to match.
What if Roche still fails to achieve 50%? Is Roche allowed to buy more in open market? Remaining float will commend high premium in the case where Roche and Shorts have to compere for shares.
FMI and Roche deal has tremendous synergy and I will hold my shares for long term capital gain as well as probable double from here. Complete buy out will happen soon rather than later.
added more today.
I'd like to thank Dew from iHUB and Ohad.
I also wish they do, but contract is written and sealed for $50 US. I am just happy with $50 now since I am not going to tender my shares.
I would vote for Yes, but I would not tender my shares in my taxable account.
This can be $100 stock in a couple years.
$250 million is cash infusion. You can not dilute shares @100% premium.
This deal is partial take over because insiders did not want to sell whole co at this discount.
I certainly prefer $50 rather than $23 where we were just a couple days ago.
All you need to do is not to tender your shares, IMO.
Supply - dwindling so quickly. day traders, those who need to cash out quick,new shorts.
daily trading vol. will be below 300k before the end of this week.
share holders for current floats would wait for a couple weeks and get $50/sh.
I know how difficult it is to sell 10k shares without dropping price,
price above $50 level will not sustain while tender offer is active because I myself will try to fetch
more in open market, rather than tendering my shares to Roche.
Demand - short covering. new investors who realize mega synergy from Roche deal (tremendous upside
potential with almost non existing float after the deal closes)
I added more today.
Buy put option as you said instead shorting. More cost effective I think,
Load up all the put's then short all the way down to $23.
This way You will make tons of money,IMO.
Don't " fade" your money, Kool!
I gave you a thumb up because you sound like professional.
I like your Kool word "fade".
Don't let your money "fade".
I bot more today.
either I tender it at $50 or trade later after tender offer closes.
I wonder how many shares will be left in the market for trade.
going higher is most likely.
new PT of $67 which I agree.
Roche underpaid. Insiders did not want to take $50/sh.
That's why they gave $250 mil for 5 million shares in the form of secondary offering.
Promised additional $150 for R&D.
Agreed upon only 3/9 director seats and complete autonomy.
This is not typical buy out deal where you can expect 5-10% discount.
4 million sh shorted prior to this deal.
Management is not selling for just $50, they will aim for higher return,
Roche thinks this will be big and gave Mr. Pellini incentives/motivation to execute the plan.
There will be a lot of share holders may not tender their shares,
Roche may not get over 50% of total shares with this offer.
This can run 10-20% in pps easily with small trading volume.
Short squeeze can happen anytime or with reimbursement PR.
FMR or big fund may not tender either.
Roche and Shorts may end up competing for the small float.
I would not try to shave ice on this.
NOT a mandatory tender offer!!!
Previously, I had some concern about IP and low entry barrier into this field.
First-mover advantage is their IP.
Time factor is the biggest barrier.
30,000 and fast growing data base can not be reproduced easily.
FMI branding is firmly setting into the medical community.