Thanks Mustang, its worth a repost
Third attempt at this one:
Hey Rocko, I liked your write-up this morning with the 5 possibilities listed and I agree that they are probably the 5 most likely scenarios. Possibly worth a sticky on that post!
As for the probability of each, I do see things a little differently than you. I think Option 3, equity stake, is a lower probability because Medtronic didn't like the way it worked out with Mazor and they have probably learned from that mistake.
Option 1, Titan going it alone is also highly unlikely in my opinion; they honestly don't have the resources to deploy such a complex product into a highly competitive market without bigger backing. The closest to this option would be if they sign a marketing agreement with another Big to utilize someones existing sales force and contact base, but another Big who would be interested would just buy them out, so I am doubtful on Option 1 as written.
Option 5, just keep licensing patents, I think is also unlikely because they would quickly alienate the entire market - every new licensee would be a poke in the eye to prior licensees and the market would rather abandon them completely than risk competing with 5 other companies all using the same tech.
Option 4, another Big steps in with an offer, is a real possibility and my pick for second most likely option. I might have ranked it lower if I hadn't been told by Titan Mgt that the Medtronic rep has been specifically excluded from some board meetings; I think other suitors are most likely the topic of discussion at those boar meetings and hence I believe this one is firmly on the table.
Absolute greatest likelihood in my mind is Option 2, immediate buyout by Medtronic or at least an attempt by them to do so. Titan may already have other contacts in place who are working on counter-bids; some offers have non-compete clauses stating Titan cannot then shop for other offers, but as I stated, my belief is that the shopping started a while back. Either way, MDT won't want to drag their feet on a deal because of how it worked out with Mazor. And another hitch with Mazor was system reliability - so there's a good chance that the handshake deal with Mr. Martha includes the additional tweaks Titan has been doing over the past year, possibly at Geoff's request, so they know that what they are getting will hit the ground running - since everyone wants an explanation of why we still seem to be refining our platform. I'd go so far as to guess that the whole Enos/endoluminal capability was driven by this handshake deal, maybe even before Mr. Martha took the helm. The $18M milestone/raise might have been to meet funding requirements for this MDT-requested development effort (explaining why Titan's raise was one of the Medtronic milestones). That money funded development to meet MDT's development vision but wasn't provided by Medtronic directly because... Mazor all over again if they did. And conveniently, it was all pre-arranged so it could be announced a day or two later! When is the last time before that Titan announced a raise and then wrapped it up that fast? Never. It was a done deal.
All my opinion, of course, as always... but yeah, I'm sticking with Option 2 and now you all know why. And if my reasoning here also answers some questions or doubts that were lingering in the back of your mind... you're welcome!
