Ariad Pharmaceuticals Inc fka ARIA

[puravida]

It's a confusing category for sure and since the present value of the CVRs can fluctuate depending on the forthcoming events/study results it's difficult to nail a present value of a cvr.

But my understanding is since the acquirer is assuming a greater risk in the the deal since these cvr's are based on events yet to unfold, the acquiring company transfers that risk onto the current shareholders of the acquired company thus allowing the buyer to offer a more attractive takeout price range to the shareholders of the company to be sold.

So therefore yes the CVRs only apply to folks who own shares in the company being bought. CVRs usually have a life span And I assume the final price of these CVRs are worked out by the time the deal is finished and the timeline for the contingent details occur within that timeframe

I'm certainly trying to learn more about these incentives and am wondering how Denner would articulate them during a deal negotiation as ariad imo has plenty of cvr-worthy instances-Japan approval and increased sales thresholds being a good start.