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Negative interest rates might be something new but I don't think it would be a negative on ariad's stock price. As a matter of fact one of the reasons the stock market as a whole has performed so well is probably due to low interest rates. They promote growth and just as importantly no one looks to put there money in low yield debt. If interest rates go negative at some point the stock market will be the only game in town.
We certainly agree on that point. I'm not suggesting in anyway that a hostile is underway or will be underway. Goodness if it was underway now and we were sitting in the 4s we would be in a not so good position. My only point was that we no longer have any say over the matter and neither does the board. There is no requirement that anyone has to consult with Ariad's board before making a play on the stock. Hostiles drive the price up, sometimes very fast so in a good market, or when a company has a strong valuation, the purchaser would want to work with the company to come to terms on an orderly acquisition. Clearly at 4 bucks the ARIAD is going to say they are worth much much more. So in our current state the acquirer might say...... hey Im just going to start buying stock even if it drives up the price then go to the board and say, I've already got my foot in the door you can either do this the easy way or the hard way. Either way they need zero cooperation from the ARIAD board if they want to make a play for the company.
That's not how it always works. When prices are this low they can skip going to the board and start buying so that they have leverage when the go to negotiate with the board. There is no rule that they have to start with the board. At some point their ownership percentage will trip filing requirements but they are under no requirement to discuss with the board.
A hostile doesn't need to be approved by anyone. That's why its hostile. Some company goes out and just starts buying up shares. Now that the poison pill is gone there is nothing to stop it other than supply and demand.
All of my points apply just as much to him lightening his load.
1. He can't sell even one share as the chairman if he has insider information or if he is in the company black out period and this applies to his hedgefun.
2. Selling any amount of shares would be bad for his remaining position given that it would cause a meaningful decrease in the stock price which was my point if he is going to sell any he is going to sell all.
3. IF he needs money selling shares in the larger companies would allow him and easier way to raise funds. Their market caps are bigger, his position relative to those market caps are smaller and he isn't an insider.
So why wouldn't you be surprised? Please provide any insights you have into why he would sell his ariad shares.
You said you wouldn't be surprised if he was lightening his load in ariad. Does that not mean selling his shares. Is selling shares liquidating a position. Please clarify.
I can think of a multitude of reasons why Denner would not liquidate his position in ARIAD over the larger pharmaceutical companies that he bought. I'll list several of them for you.
1. Depending on the timing he might be unable to sell his shares. I have mentioned this numerous times but the point seems to be ignored by some trying to support their thesis. Insiders, certainly not the chairman of the board, can't just buy and sell at their leisure and periods where Denner is unable to sell, due to either insider information or the companies own black out period, extends to his hedgefund.
2. Reason 2, even if Denner was able to sell when he wanted, ARIAD has a sub 1 billion market cap. His decision to liquidate would drive the stock lower giving him less proceeds. This would be the case even if he wasn't an insider, but because he is an insider this would likely cause a bit of a fire sale for the chairman to dump a good bunch of his stock. Again this would only hurt him in the long run and significantly reduce the proceeds he was able to generate should his hedgefund have a liquidity issue.
3. If one were to agree with your assertion that Denner might prefer to keep his more recent investments in larger Pharma one still has to consider the practicality of him freeing up cash. He can sell his investment in large companies with much greater ease. They have larger market caps and he doesn't hold insider info, also his positions relative to those companies total market cap are very small and would move the needle much much less.
4. Last but certainly not least, Denner would lose control over the company. He won't do that unless he wants to exit all together and he won't be doing that on the open market for reasons 1 and 2 above. This is simple really, when Denner exits it will be through an orderly sale.
I reckon ariad would not be the investment Denner would sell in the face of liquidity issues.
Yea I'd be very surprised if he sold but didn't file the appropriate forms disclosing those sales given his current position as chairman.
We certainly may go down further. We are actually nearing prices where I would actually be a buyer. Somewhere in the 4s I would add. The only reason I don't add now is I think the markets, biotech indice, ariad could still be sucked down further and there might be a better deal to be had. However in the mid 4s I figure I might not be hitting the bottom but absent an economic downturn in the U.S on top of the market correction or switch to a bear market, and I'd still do well with and Add as long as I was patient.
Really depends on whether the fund is leveraged, what the rule is for pulling money out of the fund and how much dry powder he had on the side.
He might also be well prepared to weather the downturn with reserves. All speculation unless someone has a copy of their balance sheet and the L.P agreements. Sometimes these funds have provisions for additional capital calls.
However reverse could be true as well. The individual who initially brought this up also speculated previously that denner was likely selling part of its stake in ariad due to various reasons. That speculation turned out to be false. This one very well too.
Everyday Someone makes some assertion of optimism about ariad to feel better. Most never come to fruition some are actually impossible. It's been going on here ever since the crash and actually quite long before that.
I expect no adds to his position since he has the previous cal. For 1)he was precluded while the PP was in place. 2 he is an insider and purchases and dispositions require filings and 3 neither He nor his controlled entities can make purchases during during what is commonly referred to as "a black out period".
Until they disclose the q4 and annual info he won't be making any purchases and when he does you will know about them due to the filings.
Cheap oil is good for the economy, unless of course its too cheap. Right now its very much too cheap. There is a sweet spot where energy dependent companies and average joe american don't feel the pain of high energy costs and where energy producing (or companies that benefit from energy production) are still profitable and able to expand their business. Right now oil is far too low for the latter.
Without doubt Denner bought ZERO shares this morning. The year has ended, they have not released earnings, filed a K etc. He is most definitely in a black out period as he is privy to confidential information and both he and the entities he controls would be precluded from buying stock.
This year should finally be interesting. With Denner becoming the Chairman and the removal of the PP, err I mean "shareholder rights program" it looks like we have finally hung the for sale sign on the door. If we don't get some interest in the next 12 months I think its a very bad sign as the door is now wide open to anyone and you have to think Denner is trying to facilitate the M&A activities behind the scene.
For decades we had a guy who wanted to hold on to his baby (berger) so the fact that we never got sold isn't surprising. If we can't get sold with the CEO of a hedge fund as our Chairman we are up a creek without a paddle.
Maybe he thought they would counter at the time with a higher offer, maybe he wasn't in the drivers seat with respect to accepting that offer at the tine. Who knows. All I know is that dismissing a 20% offer increase as too small to be concerned with when the offer already would have provided a 100 percent return to his fund would be akin to a lottery players mentality. This isn't investing it's gambling with only one thing in mind. A jackpot. Jackpots are hard to come by. With that being said I've bought 20 bucks worth of powerball tickets for tonight and am hoping to be the big winner.
I really think it's amazing when people refer to a couple of dollars per share as being little motivation to Denner. I can't remember exactly what his cost basis is but just for easy if math let's say it's 4 bucks per share which I think is pretty close. Every extra 2 bucks per share in a buy out means his Return on investment is 50% higher. That would certainly be a lot of motivation if you ask me. It's also millions and millions more dollars in his pocket!
I just find it interesting that people think a company rejects a bid expecting the next bid to come in 100% higher than the first and 300% higher than the current stock price. At a bid price of 11 bucks a 10 to 20 percent increase represents approximately 200 to 400 million dollars in enterprise value.
After all this time and the many disappointments I'm marvel that expectations remain so high.
Because it's approximately 10 to 20 percent more and it's currently more than a 100% premium to our stock price.
What did it plunge from? I don't normally associate a stock that is 72% owned by institutions as having a percent that had plunged. What was it before.
Should be interesting come January 1st when Harvey vacates the CEO position even if a new one has not yet been named. Either a buyout is coming which is why they haven't named a CEO or no one wants the job. Shouldn't take this long to find. CEO.
First as far as business combinations go and the accounting for them Ariad would not be one that I would consider to be complex. Complexity in a business combination comes from integration and ARIAD isn't that big or complex, its operations are relatively small. Marriott is buying Starwood, that's complexity!
Second, it really doesn't matter when the deal closes. Its not going to be the date that the deal closes that drives the stock price its going to be the announcement of the deal. That's how it works. Deal and terms get announced stock price moves to the deal price less a couple percentage points. Doesn't matter when it closes, its the announcement date and the terms.
Just to be clear cash at 9/30 was $282.2 Million and cash at 6/30 was $273.9 million
This means we have 8.3 Million more dollars than we did last quarter. Given that we raised 50M in the quarter it would seem we burned through approximately 41.7.
You can't add the expense lines items to come up with the cash burn for god sake. First revenue came in and second certain expenses are none cash. If you want to know what they "burned" in the quarter go look at the statement of cash flows.
I can't agree to that.
Befuddling. It's a great word and captures the essence of the situation.
Great so U woke up this morning and decided to post targets from July. We all know the analysts point of view nothing has changed..... What's your point or motivation?
Please complete your sentence. Do I realize what? That you posted price targets from July? Yes I do
Thanks for the updates from July?!?!?!
Then if he had been forced to liquidate we would already know.
You do realize that as a board member denner'd trades are restricted and this restriction and requirement for disclosure extends to his fund right.
Yes, I normally don't comment on the SA articles because, to your point, anyone can write them and they can often be pretty bad. Although sometimes they can be a worthwhile read. The only reason I commented on this one was because I thought it to be particularly bad. The comment about bankruptcy, in my opinion, was made to invoke a knee jerk reaction from the uninformed. My default position isn't to say something is a hit job or "shorts" at work but in this case, I'd be inclined to say that's likely the case.
I've given no credit to anyone. Simply called out what I found to be the most unlikely item contained in the article. As an aside people can post anything they want on this board, as long as it doesn't conflict with the TOS, as well. Unfortunately factual accuracy isn't a requirement for posting here either and we have a long history of unsubstantiated claims both positive and negative here as well.
Ariad certainly has its problems but bankruptcy by the beginning of next year isn't one of them. This article is pretty uninformed or intentionally bad.
Oh sorry didn't mean to put words in your mouth. How did you think ariad would be taken private
Oh ok so no Press releases are going cause someone to buy Ariad and take it private. Not 1.5 billion eg its present market cap. Less? How will they acquire it. The board rejected a 2 billion dollar offer so it stands to reason they won't approve one for less just weeks later. That would seem to be a breach of fiduciary responsibility. Will it be more than 2 billion. If so I'm on board. If not how would it happen given the poison pill.
So there is nothing going on but you think someone is going to raise 1.5 billion dollars to buy ariad, in cash, and take it private. Why? Who? Gotta hear a reason to have this one make sense to me.
Rwally please expand on this view. Dying to know who is going to take them private
Couple things...... and I'm not a tax accountant or attorney(although I am a CPA) and there is so much nuance to some of these tax items but.......... To simplify that matter........ Typically when a company has tax operating losses they can offset those losses against future profit. If that company is purchased, the purchaser (if done right) can also utilize those operating losses in the jurisdiction they were incurred. However, for federal purposes if the company has a 2nd change of ownership the next owner can't utlize the operating losses of the company which incurred them. So they can legitimately put the "poison pill" in place to protect the tax carryforwards because when there is a total crash in the stock price and its trading so frantically, if one entity would gain control then sell and another entity would gain control ARIAD couldn't use their own tax credits because they would be voided due to the change in ownership provisions, even if that change didn't result in the total acquisition of the company. Again, This isn't an area I have specific expertise and Im simplifying the matter but that's how I understand it.
Either way its a moot point. The main driver of the shareholder rights plan was to allow Harvey and the board to keep control of the company. They just put lipstick on it so it didn't appear that way.