Avid Bioservices Inc (CDMO)

[Protector]

drontle2, the reasoning is solid but I am sure nobody out there will take that into account by any acquisition price setting (that is if acquisition there should be).

I personally don't see us be sold below 40$ if it would happen in the next 28 months. This management is more greedy that previous composition (an opinion), and knows very well that increasing capacity to have a potential X$ production at M% margin, is NOT the same as having all that with a FILLED order book to effectively milk that capacity.

Furthermore the acquirer will inherit contracts such as that from HALO which does this continuous yielding of new contracts for HALO's BP costumers and their drug targets for ENHANZE.

And now that we are talking acquisition, IF (and that is a BIG IF), there would be a suitor, I'd speculate on HALO for the following reason.

>>>HGEN is by far not in as many manufacturing needs then HALO, yet they signed several CDMO's (see bottom slide where Avid is mentioned too)
But HALO with wales as Roche, J&J Janssen and plenty more, of which most have multiple ENHANZE targets, keeps clinical trial manufacturing with Catalent and Production manufacturing with Avid/CDMO.

Furthermore HGEN has several other lines running while HALO puts all-in on the HENHANZE business. So, having control over their own manufacturing would not be a luxury.

And from a time to market perspective, what is faster then buying the company that already has the experience, the FDA approved lines and is manufacturing for production of your biggest client?

Add to that that they apparently don't know what to do first with their money (they did a share buy-back this year) and project even (was it doubling) largely better results for next book year.

So, IF (IF,IF, IF) there would be a party to acquire us then it is HALO because there is a huge added value for them to even do it at a 2 HALO for one CDMO share (which would be huge for us, and still cheap for them).

AIMO