I am not scaring people who have invested in this CVR. I am telling the actual Facts and it can be easily achieved.
We will paid if the adjusted EBITDA is $1.267 Billion. Last 10-Q reports says "Each CVR represents the right to receive a pro rata portion of an amount equal to 2.5 times the amount by which cumulative Adjusted EBITDA of APP and FKP Holdings and their subsidiaries on a consolidated basis, exceeds $1.267 billion for the three years ending December 31, 2010."
Here are the calculations to get $6 per CVR after Dec 31, 2010
Max CVR value is $6/ CVR or $980 Million total. If I divide 980 Million /2.5 times = $392 million. (We get 2.5 times the amount that exceeds $1.267 Billion).
So Adjusted EBITDA should be $1.267 Billion + $392 Million = $1.659 Billion.
Adjusted EBITDA as of Mar 31, 2010 : $740 million
Next 3 quarters Adjusted EBITDA (Considering the CVR price goes up) : $330 Million
For us to get the Adjusted EBITDA to $1.659 Billion as of Dec 31, 2010, we have deficit of $1.66 Billion - $1.07 Billion = $590 Million.
So the CVR price should be $590 million / 163 Million CVR = $3.62 / Share.
Also I have not included the sales of DIPRIVAN in the Adjusted EBITDA. It could only go up and required CVR price will be less than $3.62.
Finally, if the CVR price is $3.62 as of Dec 31, 2010 we will be paid $6/CVR. I think its a good oppurtunity for everyone to get the easy profit. MM's might know all these calculations and might slowly accumulate all the CVR's. From Dec 31, 2010 its only 66% profit. But if you consider the current price, the profit will be 5000%.
With these calculations, I am decided to hold my CVR's and see if I get 5000% in 13 months. I know everyone look for the near future. But in the long run, it might turn out to be a good profit.
