I don’t think your proposal makes any business sense and repeating back to me that what I said isn’t really a real answer either.
I have repeatedly addressed the actual issues. You believe that deducted Improvements to the leased facility would be meaningfully transferred, at this stage without an actual commercialization plan that still requires NWBO to fund it and that somehow they would earn $50-100 million. That makes no sense.
They do not currently own anything that has that value in Sawston. It needs to be developed. What is developed is under lease by Advent though NWBO gets to deduct the improvements, and it is a part of a development authority deal that they have that comes with further obligations. The lease is an obligation. The leases are obligations. Whether Sawston ends up fully populated with Flaskworks immediately, or later still apparently is in process. Who owns the facility and what can be done with it comes with a mess of complications, and I think your plan does not come close to understanding the circumstances overall. Nor do I think it is the asset you claim it to be. It is an asset, they can deduct costs expended, but the greatest value the facility has right now is its value to NWBO and it’s potential value yet to be realized by NWBO. They can definitely, after doing a sale and leaseback, now basically transfer their lease to another party, mostly unfinished except for the part that Advent is leasing, which generates a slight bit of revenue, but nothing worth 50-100 million, and it is doubtful that you understand their various needs and obligations to make your determination, but I say again, it seems detached from reality and not grounded in anything that remotely resembles what the company seems to have described as it’s actual plans.
I am the first and last person to argue that Cognate has an expiation optional clause for it to negotiate further capacity. While that may yet occur, it depends on things like demand, once Sawston is built out and regulatory requirements in terms of territory served, for instance the FDA and other regulators might want facilities closer to care, which has been noted as a possibility in some filings. But for now the company expects to develop Sawston.
It is possible that someone could buy advent while buying the whole lease, but they’d have to contract to develop the facility, and they’d need a license to use the Flaskworks systems if NWBO intended to license that out, and further, NWBO would no longer be in charge of its own commercialization because the facility would no longer just be managed by a third-party, but owned by it and they might utilize it for other needs, other companies. But if they did not, NWBO would have to pay them for all of that wasted capacity set aside for NWBO as they have done in the past in up front payments to Cognate.
The current arrangement is much less onerous. They own the facility and they can develop it as they need. The additional space can be utilized as the company contracts and determines without having to pay someone else to keep it for them. They can for instance, pursuant to their development authority contract, allow Advent to use it for services to other companies until they need it for scale up.
But a purchaser is not going to walk into that sweet deal. They will want to be paid to OWN the facility and not commercially fully use it to generate revenue to earn back a return on capital.
You’re right about one thing, if they were planning on going out of business, they could sell the plant, for cash. Iwothout plans to scale up and develop it further it has value for entertainment or a range of uses. Advent might even be able to afford part of it for small local business that need their services, at least just that small space they have now.
But again, it makes little sense and posting the spreadsheet image doesn’t address all of the issues. I think you seem not to understand their challenges.
If they get bought out, NWBO, then yeah, they might not need Sawston. Then a sale of their lease arrangement that they already milked for cash in a sale leaseback, might make sense. A new owner might already own a space and be well capable of setting up Flaskworks and might not want to be saddled with an undeveloped factory.
Cognate is not without something of huge value being transferred, in exchange, going to contract to scale up manufacturing if DCVax, as you posit, for free, AND pay NWBO $100 million to take an undeveloped lease off of their hands.
