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I can confirm the 21st as well....I wonder if we get an M&A announcement with this one.
Ah Price Targets......Why do I get the sense that if the stock price starting going up to even 50 cents we'll start hearing the 8-10 dollars again, oh wait - maybe if it goes to 80 cents or over a dollar we'll start hearing 25 dollar M&A...This stock does not follow the market. The tech, science, GCV should/will be valued appropriately and that number has nothing to do with the current SP. The suitor or potential suitors would likely pay handsomely assuming there is indeed synergy between the two companies. Speaking of synergy, I'd argue there isn't a company out there today that isn't at least hinting at innovation as part of their core values or business strategy.
Bottom line is that disruptive tech like this is a rarity in the industry. Now that the science has been proven, It's only a matter of time before fair value starts to show its face. If you don't have patience and you have spent more than you can afford, then you should re-evaluate why you invested in the first place, but for those that can see what's going on behind the scenes, then in my opinion - you are in for a treat.
On the bright side, Crickets are exactly what you should want if you believe in M&A. It's obviously one of the biggest signs of M&A. Best to just hibernate right along with them, and maybe add a few shares here and there (as i've been doing) along the way.
The other piece of promising news is we have a rockstar sales team, that has in my opinion been quietly pulling in multiple new purchasing agreements (not only as stated in the 8k) but likely Australia, Brazil, Japan, and likely even Taiwan (TBA), with China already pending and likely to hit sometime mid year 2018. I've said this before, I doubt a company like Zimmer lets them showcase this at NASS right alongside them unless it's as a subsidiary. Think about it, can you picture Amedica gloating about Si3N4 on the NASS sales floor sitting right next to Zimmer, all while Trabecular has been a huge failure? I guess we'll find out soon.
Ya, I'm seeing price/book at min of .50, price/sales .80, and book value (MRQ) 1.39 after the last 8k. I mean that's just crazy cheap. All they have to do is release their financials and if there is any increase at all this thing is going to move big time. Big time Gapper.
Slow yes, but with 35 employees, expectations are stretched. The entire company barely fills a conference room. Not to mention who is currently working on the audit committee, R&D, Ops, Sales, etc. And what you have left over is a company that has done some pretty remarkable things lately given their size.
Fact: Only 4 months before all Herc debt is gone (if not already) and also fact, they have new purchasing agreements. The combination of the two (with a 21k mo interest payment loan from none other than the CEO himself) is pretty exciting for shareholders.
Regarding M&A: Companies generally don't want to wait for a company to explode before they make a move. With Amedica, it certainly looks like that could happen any time now this year. There is nothing effectively holding them back from exceptional growth at this stage.
The audit messaging has rendered consistent feedback and confirmation for the delay of the financials. All this does is validate their strategic communication plan for possible M&A.
I have been doing some more in depth DD and..
I have some reason to believe based on very loose connections on LinkedIn and other research that Paul Graveline former Global Spines Sales VP for Zimmer (now works with small-medium size businesses) and Global Marketing operations from Zimmer are working with Amedica. The marketing connection makes sense considering if a merger does happen then they would had to strategically plan their locations at NASS 17. In addition Paul had worked on the same road in MN where the R&D took place for Amedica. One can start to connect the dots here and formulate their own conclusions, but if you stack the evidence of merger, than it makes sense.
BTW - I voted YES.
Why didn't LDR Spike? Same scenario.
Stock will be halted unless,
We see an appeal to Nasdaq within 7 trading days after the 14th. This could very well be the last week of trading for Amedica in my mind. A merger announcement could very well happen this week. Lets see how things play out. I do think this was to buy time as originally stated.
Look at it this way as well,
If you compare LDRH prior to Zimmer BO (1 mo chart), the shareprice was suppressed there as well. People always ask why weren't people buying!? They don't want to rock the boat per say and draw attention. You suppress the SP, keep the SP in a channel or off tech radars, with exception of ER revaluations (similar to what happened from .27- .44 after the last PR.
Careful, Bears are testy this morning. lol
I would be too if they got rid of my the one leg I had to stand on to short this thing. No more safety net.
Windbag makes a good point here. Sonny now stands to reap some pretty significant rewards in the event of a merger. (660,000 + Golden parachute+ Options + Stock already owned + any potential position offered to him by the merging company)
Anyone thinkings otherwise is clueless. This is a slam dunk and a company showing gratitude to a guy who has done a wonderful job pulling this company out of water. This is also Sonny showing that he has confidence this SP will go up, not to mention confidence in the company, otherwise why the .42 price and why even do this to begin with. This is going to be good.
Deal will be final by...
End of Q3 imo. Timing lines up perfectly with the proxy, with the CSC submission, and with the NASS showing. By the way, I have pointed this out before, Their booth is prime time and one of the best locations you can have at the show. All will be final so they can hit the ground running to push sales and growth of this new tech. The evidence presented here is overwhelmingly suggestive to merger activity. Timelines all add up.
Basically by end of Sept which means deal could be announced any day.
Signs of a strong Merger & Acquisition:
Selection of a Strong Leadership Team:
"A well-prepared and available M&A team is essential to the overseeing of a successful merger or acquisition. Not only do you need to have members who can devote significant time to the process, but they also should have extensive knowledge of the unique needs of each company involved. It may involve pulling members from the corporate board or other leadership roles from either company. Regardless of who is chosen, ensuring that they are given sufficient resources, including in the form of time or compensation, is vital to their success as leaders of the M&A process."
Source: 5 Signs of a strong M&A
Long lived asset audit
Not to beat a dead horse here. But this long lived asset audit process is time consuming and standard practice and essential to be in compliance with gaap for a Merger. INCR and Inventiv just went through a merger and had to showcase the same info. There is open info on their site that displays all the merger info in a pdf dated May 10th. (or just google it)
This is all essential to valuation and compliance.
Source that explains it a bit more.
http://www.whartonvaluation.com/financial-reporting-for-mergers-and-acquisitions/
ya and if this is the case...
Then I would expect Herc to be paid off after Hercs ER. Doubt they let this leak. Would be smarter to payoff sometime right after. Keep everything contained.
Yep, This be a horizontal Merger imo.
Any of these milestones below look familiar?
"There are many milestone dates during the M&A process, which can be confusing for an unsophisticated seller. In most cases, however, the closing date is the key milestone when the sale is consummated and the seller actually receives the agreed upon consideration (i.e. cash, seller note, consideration shares, etc.).
Some of the milestone dates in a sale process that a seller needs to be aware of include:
When the letter of intent (LOI) is signed;
When the due diligence data room is required to be ready;
When asset appraisals are completed;
Removal of conditions precedent;
Removal of financing conditions;
Buyer board approval; and, finally,
The closing date - when the deal is executed."
Information sourced from: https://www.divestopedia.com/definition/966/closing-date
A few things
1.
Given the issues I was reading about on Trabecular Metal Dental Implants between 2012 - 2015 on Cafe Pharma and assuming this is valid feedback, Then it's easy to see why Zimmer would sign an LOI agreement to research Si3N4 back in 2015, and another reason why this has taken 2 years since LOI lead to any sort of BO. Not to say Zimmer and others weren't keeping a close eye on Americas progress prior, I just think these sorts of issues lead to mitigation plans that include definitive research published and completed prior to making the same mistake again. Meanwhile Zimmer Dental has been taking major hits on their ERs which is in line with the feedback. Sonny has emphasized over and over how their research will be rewarding. Lucky for us, the research has indeed been positive and smokes the competition in several key areas. 2 years since 2015 we now have several published reports to back the tech including some breakthrough reports on si3N4 Dental effectiveness. This leads me to believe they have what they need to make the plunge (not just including what they have been tracking for ortho, they would likely look at all areas of use)
TB Dental Implants
2.
Having had some time to absorb the last proxy. As many have stated already, they will likely be presented with a letter by Nasdaq on the 15th, then have to request a hearing. This ultimately buys them more time. With a that being said, Financials will need to be in as well. Of course this may all turn out to be a moot point if there is a BO announcement. If BO is the event happening then, the proxy does indeed as CL points out does hint at some things happening behind the scenes (timings, accelerated options) Let wait and see what the definitive discloses. The evidence is mounting for something big happening at literally any time now.
Accumulation
Look at LDR, why didn't the stock sky rocket before Zimmer acquired them? They traded in the same channel pattern as Amedica prior to buyout. Amedicas SP went up after the ER and has been trending up in the last week because of it, which is normal, but unless you get a definitive leak, there is no reason this shoots up. If you watch the bid/ask, There are fake walls being thrown up left and right.
Hi all as we now head full speed in what could turn out to be a very interesting week I wanted to repost a link that I posted in late June that might make more sense now.
[url]https://www.quora.com/Do-companies-ever-announce-their-own-acquisition-during-earnings-releases-conference-calls
[/url][tag]Why Companies announce Acquisitions during earnings[/tag]
The source says, "If you’re a public company and you enter into a material contract (i.e. acquisition agreement) you have to announce it. Depending on the timing, some buyers will time the signing of an acquisition agreement to coincide with their earnings release so they can announce both the acquisition and quarterly earnings at the same time.
Also, many companies are loath to make any material announcements from the time their quarter ends to the time they announce earnings; agreement execution is sometimes timed with this in mind."
Company is in great position,
The company has been realizing it's strategic vision and unfortunately having to make tough decisions to do so over the last two years. Now that they can just focus on sales and revs, An R/S is a bummer only because it reduces your share count. Its also a bummer if the company is in an already bad position, however this is no longer the case. If you have a company with growing revs and zero debt, an R/S would do little to devalue your share value. Book/Sales should grow and book/MRQ should grow if our ERs are good. Not that i'm for an R/S, I mean I think we all would love to have more shares worth more money , however this is not the same company as even 6 months ago, Things have changed for the better and WS is starting to change their tune as well. All they need to do is show us good earnings and we are all set. If I were any other company, i'm keeping a VERY close eye on Amedica. If they need money down the road, being in a position with a better debt to income record will simply allow them to get a real loan or even other options, without impact to shareholders.
Purposeful delay:
I can't see ANY reason that a company waits to inform their shareholders on the very last day knowing that a hearing or delisting notice is required anyway unless they are purposely buying time for 'something' to happen. In this case PER Nasdaq listing rules they will receive a delist letter and will have to request a hearing to review their status. This isn't something I'm making up, it clearly states this on the Nasdaq listing rules page. Also as I note below, R/S is a moot point until financials are in because those are also reasons they need to schedule a hearing.
A few reasons I can see for the delay,
1. Waiting through a Tendor offer period as CL suggested. He makes a good point here. If this is still in process and deadline for hearing appeal is looming. They still need to stay listed regardless going through this process.
2. Waiting for their audit to complete and to release financials. Their 10k and 10q are already late so these need to be released in order to stay compliant. Could be buying more time here. Maybe they were hoping this would happen in time? No argument can be made for an offering btw unless this has completed. This leaves no time to account for the Herc debt covenants by end of July with out 'something' happening to account for it per their 8k. Do they pay off Herc now, or Jan, (only 5 months from now) If you ask me - they pay off now, frees them to get a real loan, and/or are simply BO. They could also re-negotiate the Herc terms to pay it off earlier if it means Herc making more money (hint: they own shares).
3. Given their lack of financial resources on the team (someone could have been out sick etc) however this seems very unlikely given how much time they had.
All this said, they had to have known they were going to need to request a hearing before even sending this thing out. It seems like this was done to entertain Nasdaq while something else is finalized. They clearly are just maintaining proper alignment with Nasdaq, knowing a hearing needs to take place. An R/S with votes will provide them an argument during the hearing as long as the 10k/10q are released prior. The 8k give hints at stellar ERs to come, along with previous CC/Analysts hints pointing to this year. Should be a very interesting week next week.
Dates to keep track: Zimm ER July 27th. Herc ER Aug 3rd. Will have more answers by then. If there is a BO by then (only assuming if things were finalized), they want to disclose vs. letting it leak in there 10q. Herc ER will provide status of the loan.
Ya Holy Crap. That is a massive jump!
And thanks for pointing that out to me. Execs showing some skin in the game and confidence with revs increasing. Too bad they couldn't display that on page 1 instead of page 16. lol
So I've been looking into it,
There are a few options they are presenting, however They are holding their meeting on the same day Nasdaq is set to issue them a delist letter which means they have to hold a hearing/appeal within 7 days then do a review with the listing board.
This seems like a deliberate way to buy some time to me since they filed it when they did. Almost as if they are waiting for something to happen. They would then have the votes ready for the appeal process to present the board with a way to move the SP over 1 (if it's not already there by the time this process ends)
An option yes, but....
I’m seeing a BO vs. going private, in addition to the obvious reasons and evidence presented on this site,
1. Going private doesn't help them get the tech into more hands. Read through LDRs leadership notes for selling. Going private could actually slow down their current momentum and sales forecasts.
2. Would have to buy out SH, obtain approval through a vote, in addition to paying a premium. Can be much harder to obtain financing to do this. (Not to mention in the future)
3. Opened up to unexpected lawsuits
4. They have a business model that has grown GCV (recent 8k showcased hints of this). Huge growth potential and spurs tech innovation that larger companies require to stay relevant.
5. Science that is now proven and no need to go private to focus on this.
6. Most companies take advantage of going private by making decisions for the company without the worry of dealing with unhappy shareholders. Ask yourself, whats the real advantage? Look at some of the decisions that Nordstrom just discussed regarding going private and ask yourself if it makes sense for a company like Amedica. These are different sectors, but companies take advantage of the same principle reasons for going private.
Going private would allow them to focus on selling their product without worrying about the obvious SP attacks and regulations (sec/nasdaq). However that's about all that makes sense to me there. Not much else.
Thinking out loud here, but just some things that came to mind.
ZBH spiking today apparently because Jana Partners, the activist hedge fund run by Barry Rosenstein has taken a significant stake in the company.
My point being is that this has me suspecting they are closing a deal with Amedica. They are both finalizing their accounting and Zimmer straight up says it due to recent acquisitions. There has been no PR to disclose a 2017 acquisition that I am aware of.
Last reported acquisition was on October 27th 2016 for Respondwell. Nothing disclosed for 2017. Yet....
Zimmer Biomet Timeline
Ya - there is too much adding up here.
If this is true, my thoughts on the timing of phone upgrade:
1. They have increased sales and are adding a routing system to support the volume.
2. They are re-routing their sales for a BO.
Maybe I'm missing something, but in every scenario I explore, an offering just doesn't make sense before end of July.
1. They haven't released their financial documents yet. I believe this is required.
2. There are only 16 trading days left in July, and they need to satisfy the herc loan by End of July.
3. An offering that included SH Dilution would drive the price down, opposite of what they are trying to do to retain Nasdaq compliance.
4. There is no time for a R/S. Therefore, R/S - then offering can't happen. Not to mention the company would have at least send an e-mail like they have in the past letting SH know that they 'might' need to do this.
So if you ask me, This leaves really only a few other possibilities that I can see (that make sense given their latest 8k)
1. They pay off Herc by End of July with remaining cash and their sales are rocking enough to sustain the payoff and keep ops moving.
2. There is a buyout before the end of July
3. They obtain additional financing via other means outside of SH dilution after paying off the herc loan.
4. They obtain additional financing via other means outside of SH dilution and keep paying on the herc loan. However this makes less sense because they have already communicated this will be paid of by Jan 2018 or SOONER. There are only 6months left to pay this off.
I personally believe that the second option is the most likely. This isn't just because of the evidence presented here on this site, but they could very well be working with Nasdaq on a 1017 (change in control due to acquisition) - reason for late PR on this (M&A tag) Their audits (not just the impairment, but recent Brazil audit - justify this, don't focus so much on the impairment) During a M&A there is required DD to ensure all financials are CLEAN prior to BO.
Just found this interesting and thought I'd share. Do we get an announcement before they release Q1 or with it? Maybe right before Q2 leaving 3qtrs increased revs? Regardless one would think a 'zimmer' or 'stryker' won't wait too long before this becomes pricey or bidders start to drool over the tech if they aren't already.
Do companies ever announce their own acquisition during earnings releases conference calls?
They may already know its potential. These are experts in orthopedics after all or at least I hope so. There could be lots happening behind the scenes that we are unaware of, sure it's speculation but It wouldn't surprise me at all. Don't forget stryker could buy them out just so Zimmer doesn't get it, case and point. As stealth points out, and he makes a good point, Market share is up for grabs. These disruptive biomaterials don't come out very often - it's truly disruptive.
They don't need to do anything exploratory. It could simply be DD they are conducting, and have developed enough good relationships within the organization. Remember is all about synergy. Some we know, some we may not - there are connections internally with Stryker resources working with Amedica. Look at the recent hire. While developments may be Zimmers way of doing DD, it may not be with Stryker.
I'm in the camp that wouldn't be surprised if there is someone that outbids them. Amedica ultimately owns those conversations. They 'i hope' are trying to maximize value.
Either way, things looking mighty attractive right now no matter how you slice it.
Technological risk and market traction are all factors here for other companies.
"Smaller device companies are frequently the engine for innovation as they are more nimble. Larger device companies are looking to expand their reach into new development areas and are keeping a close eye on the smaller companies and snatching them up once they have surpassed the point of technological risk or demonstrated an ability to achieve some market traction. Companies like Zimmer, Smith & Nephew and Synthes are likely to look to enter the extremities market more heavily because that's where the projected growth is over the next few years; the hips and knees markets are only expected to grow in the single-digits."
Spine & Orthopedic Device Company M&A: 6 Key Trends
One of the most important factors in an acquisition is synergy: Innovation and growth. Just ask yourself how many markets and innovative and growth opportunities will be available to the acquiring company?
Zimmer - Amedica could be hard to beat and put major pressure on competitors. Given the industries current lack of innovative disruptive biomaterials, I do wonder if there already has, or will be competitive bids.
I also agree that Amedica has industry leading tech, although lack the means to get the tech into more hands. Zimmer does seem to be a perfect compliment to an innovation and growth strategy by growing through inorganic means. BTW wasn't this reason LDR sold to Zimmer as well?
Rival Offer for LDR Is Unlikely, but Never Say Never
Some things I found interesting in this article was Leerink Partners research on Zimmer/LDR and future acquisitions targeting spine growth opportunities.
1. On LDR "While the deal appears expensive today, it might not be from a long-term perspective."
-One has to consider Amedicas market potential (in all areas including dental) using Zimmers distro channels. Not too mention upcoming catalysts that will compliment their portfolio Dental could be disruptive in its own right, and could reverse sales declines and who knows possibly even become industry standard with its anti-bacterial properties known to be so critical in dental implantation to avoid infection.
2. "LDR suggests that Zimmer is probably a more likely acquirer of spine assets going forward"
-One thing has me thinking the LDR/Amedica play has been on the table this whole time. Acquiring two companies that could compliment each other, and also offer world firsts in technology.
3. "While this is probably "step one" for Zimmer as it looks to gain market share in spine, the medical device company will probably stick to smaller tuck-in deals in the near term as it digests LDR and Biomet while also paying down its debt load."