Typically, when companies speak about strategic alternatives, they're talking about selling the company, selling assets, etc. I've never heard of a company discuss strategic alternatives in terms of acquiring assets. Usually, a company just goes ahead and makes a purchase. This is somewhat bizarre use of language.
If I were a preferred, I'd be a bit worried. This is because management has announced its intention to spend the newly acquired cash. In the end, there won't be anything left for commons or preferred's.
I wonder how, exactly, management convinced investors to buy the new issue, particularly as they intended to spend the proceeds post haste.
Uh, I think you should read the PR again. They aren't selling themselves. They are BUYING something else. That's why the stock is going down rather than up.
Interesting. I recall Ceres and Nanotrap discussed here before. I don't think that this necessarily indicates a failure. Gates' MO seems to be to fund two or three companies simultaneously, such as we saw with CEMI, ALR, and the Korean firm on malaria.
Well, we have a pretty good idea that someone was sniffing around earlier this year. CEMI quickly shored up its defenses.
I think the key takeaway from the oral fluid malaria grant is that it's highly unlikely that Gates would have given money had not DPP Malaria results been extremely positive. I have no doubt that Gates got a peak at data from Africa. That's the bullish news.
I highly recommended that TRIB buy CEMI after the cash raise a year ago. No dice. It was too expensive, not a fit, whatever. No, they're paying interest to buy their own trashy stock while CEMI skyrockets. CEMI has Zika, Malaria, Dengue, etc, etc. CEMI is red hot and likely the object of a bidding war which will end at $12 or more. TRIB probably could have had it for $7 or $8.
Too bad, so sad.
We've just learned that Zika like causes ADEM (Acute Disseminated Encephalomyelitis) in a not insignificant number of infected adults. We also know about Guillain-Barre. I wonder if PKCgamma might be produced in cases where Zika victims have some CNS damage. If so, perhaps, CEMI could add a PKCgamma test line to the Zika test. In that way, CEMI would be able to distinguish those infected with Zika who had no damage from those infected who have also suffered CNS damage.
I did some research back in October on the concussion test partner. The "investors" here clearly forgot what I had written. Here it is again:
"There existed a company called Lesanne Life Sciences, which seems to have been shuttered. Lesanne was working on using a compound called PKCgamma as a biomarker to id ischemic stroke, TIA, traumatic brain injury and other CNS events. Apparently, the effort failed. My guess is that some or all of the intellectual property was purchased by Perseus in an effort to revive the project.
Some of the key players apparently have moved from Lesanne to Perseus. These seem to include Leslie Riblet and Ann Cornell-Bell. (Lesanne seems to be a conjugate of the two names). Mr. Riblet has a tremendous R&D resume (Buspar, among others, ie big time stuff). The pair seem to have been collaborating since they worked at Viatech Imagin almost 20 years ago when the patent for PKCgamma was originally filed.
Let's just say Riblet and Cornell-Bell have been doggedly working on this idea for two decades without success. Could the third try be the charm?"
Next few days should be very interesting, indeed. The interested party is likely sitting there with 4.9% or some such, else we would have seen a filing. Has there been a letter to CEMI's BOD? Will we see a filing soon?Typically in a situation such as this, a friendly bidder will emerge.
Larry Siebert. Hmmm? Works in M&A. He might very well hold just under 5%. That may be the basis for a bid. Got to think he's been plotting his revenge every since he got the boot. Perhaps he's joined forces with someone of means. When CEMI let lapse the earlier poison pill, I would think that Siebert would have been best positioned to take advantage.
Would I be surprised to wake up Monday morning and see that CEMI has been taken out at $12? Not at all. TRIB raised a pile of money last April with which they could have attempted to acquire CEMI, but they decided it was too expensive (I'm guessing the asking price was in the $7 to $8 range). Too late now.
This was my thought a year ago. They had an opportunity to buy CEMI, or at least attempt to buy CEMI, at a reasonable price. However, they repeatedly said that they couldn't find any worthwhile acquisition targets. Huh? They probably could have taken out CEMI at $7 or $8, but that was presumably too expensive for them. Now, CEMI is at $6 and rising. It would take $12 to get it now.
Meanwhile, TRIB is happily paying $4 million of interest in order to buy back stock. TRIB stock at $11 must be a great bargain when compared to CEMI stock at $3.50, which is where it was last year. Brilliant!
We just saw VIVO take Magellan out at 3.7x revs. Clearly, IDXG would never get that. However, if they can someone get this hulking monster to break even, I think 2x would be reasonable. I'm guessing revenues are going to be down around $6 or $7 million this year, so that's about $1 a share at 2x.
Of course, the vultures are circling. If they can't control costs, then we're looking at scrap value in the 50 cent range.
First of all, I had thought that VIVO might take an interest in CEMI, but Magellan was the target.
Magellan has 2016 revenues in the $17 to $18 million range. The price was $66 million. That's 3.7x revenues folks. Apply a similar valuation to CEMI's 2017 revenues of $28 million, that's $104 million. One might argue that CEMI deserves a greater multiple, since growth is likely to pick up going forward.
In any case, the Magellan deal multiple would value CEMI in the neighborhood of $10. I think that CEMI's higher revenue growth potential would call for, perhaps, $12.
No wonder they rushed to get the rights plan in place, because you definitely don't want someone getting you for $6 or $7.
Not quite sure what to make of this. Per Lurker on the last call, they needed $50 million of revenue to get to break even. Obviously, that was not going to happen anytime this decade. This implies they were $40 million "over budget". If they cut $11.5, that would mean they are still losing $28.5 million more than they're taking in.
Unless I'm misunderstanding something, this is still not a viable business. Not even close.
Apparently, they may have been bribing officials in Africa, Asia, and Latam to get contracts. If they won contracts from CEMI on the basis of bribes, I think CEMI could potentially take Alere to court.
No doubt. I think there's an alternative scenario whereby CEMI becomes the predator rather than the prey.
That said, would I be surprised to wake up Monday morning to news that CEMI had been taken out. Not at all. I think $10 is probably the minimum, at this point.
I think the cancer test has been grossly underestimated (I have grave doubts about traumatic brain injury test, however). The idea that patients would get a result in the doctors office within 15 minutes. That's game-changing. People hate having to wait days for a result.