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Post by aceton3 on Sept 5, 2018 11:21:10 GMT -5
So now that the SP is above $2.38, anyone have thoughts or info on the warrant status?
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Post by traderdennis on Sept 5, 2018 11:28:36 GMT -5
Warrants are not executable until a date in October, I don't know the exact date.
There is incentive for warrant holders to sell in the money calls to pocket premium and it they are executed convert those short calls with warrants. For example the warrant holder can sell the Jan 2019 $3.00 call for .82 per share. If the stock price is at 3.00 or below, the warrant holder pockets the 82 cents and gets to sell more Feb/Mar contract. If the price is 3.01 or above they have sold shares for 3.00, they keep the 82 cents and make an additional .62 cents on the difference between the call price and warrant execution price. If they were allowed to convert today and flip, they would only make about 40 cents per share with more risk than selling the calls. That is why most of the warrants will not convert until the end of the warrant redemption period. Today there was large volume in the Jan $5 and $7 calls.
If a warrant holder is going to flip the warrants, they may sell short the 7 million shares first, then cover with warrants as this has less risk than converting warrants and then selling. The MO of the large warrant holders are not to invest long term in the company.
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Post by compound26 on Sept 5, 2018 11:28:54 GMT -5
So now that the SP is above $2.38, anyone have thoughts or info on the warrant status? MannKind (NASDAQ:MNKD) investors this past week saw the news that the company is doing a stock offering to raise a bit over $26 million in cash. The deal involves 14 million shares, which prices the stock at just $2.00 per share. Included with the offering are warrants to purchase another 14 million shares at a price of $2.38 per share during a narrow window of time between October 11th of this year and April 10th of 2019.seekingalpha.com/article/4161653-mannkind-raises-26_7-million-stock-offering-enough |
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Post by celo on Sept 5, 2018 11:31:49 GMT -5
Another 4-6 months of runway in those warrants, depending on the amount of Afrezza is sold in the next 6 months.
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Post by tinkusr8215 on Sept 5, 2018 11:38:21 GMT -5
depends on the warrant holder.
1. Hold on to warrants and convert to common at a later date if they think share price will keep going up
2. Take profit - Short common above the warrant price to lock in profit - any price above 2.38 - which could be now , or 3 or 5 or 7 or 15 and then cover by converting the warrants to common shares
3. Take profit - Convert warrants to common @ 2.38 and then sell the long shares as when they feel like .
4.
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Post by traderdennis on Sept 5, 2018 11:39:06 GMT -5
Another 4-6 months of runway in those warrants, depending on the amount of Afrezza is sold in the next 6 months. See above, the warrants will not convert until the end of the redemption period. If you look at the Jan 19 $3 and $5 calls, there are options over 4 million shares in positions, most likely the sellers are the warrant holders. |
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Post by traderdennis on Sept 5, 2018 11:40:36 GMT -5
depends on the warrant holder. 1. Hold on to warrants and convert to common at a later date if they think share price will keep going up 2. Take profit - Short common above the warrant price to lock in profit - any price above 2.38 - which could be now , or 3 or 5 or 7 or 15 and then cover by converting the warrants to common shares 3. Take profit - Convert warrants to common @ 2.38 and then sell the long shares as when they feel like . 4. 5. 6. 1. Hold on to warrants and convert to common at a later date if they think share price will keep going up If that is what the warrant holder would like to do, then they would convert on April 11th as to no incur downside risk in the period. |
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Post by celo on Sept 5, 2018 11:42:57 GMT -5
Another 4-6 months of runway in those warrants, depending on the amount of Afrezza is sold in the next 6 months. See above, the warrants will not convert until the end of the redemption period. If you look at the Jan 19 $3 and $5 calls, there are options over 4 million shares in positions, most likely the sellers are the warrant holders. End of the redemption period being April 11th, 2019? Correct? My point is getting to that date shouldn't be a problem with the new funds from United. |
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Post by rossomalley on Sept 5, 2018 15:38:44 GMT -5
But what about all those Deerfield warrants at $1.80? IIRC there were 7 million and they could be exercised at any time. Did Deerfield kill the rally today with another big short?
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Post by traderdennis on Sept 5, 2018 21:50:50 GMT -5
But what about all those Deerfield warrants at $1.80? IIRC there were 7 million and they could be exercised at any time. Did Deerfield kill the rally today with another big short? I don’t remember warrants specific to Deerfield at 1.80. It possible could be a price that they can convert debt to shares. Another possibility is they are very old pre split warrants that would now exercise at 9.00 per share |
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Post by rossomalley on Sept 5, 2018 23:37:12 GMT -5
But what about all those Deerfield warrants at $1.80? IIRC there were 7 million and they could be exercised at any time. Did Deerfield kill the rally today with another big short? I don’t remember warrants specific to Deerfield at 1.80. It possible could be a price that they can convert debt to shares. Another possibility is they are very old pre split warrants that would now exercise at 9.00 per share You’re right, my language was sloppy, not technically warrants but rather the option to convert debt to shares. It was repriced down to $1.80 as part of the renegotiated Deerfield deal in July IIRC. I think there was a cap on the total dollar amount but it was many millions of shares at that price. I’ll look up the details tomorrow if no one else remembers off the top of their head. |
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Post by lakers on Sept 6, 2018 1:03:20 GMT -5
It’s highly likely the 14M warrants will be converted at $2.38 during the 6 mo window 10/11/18-4/10/19. Mnkd will get $33.32M.
$2.27M each is due AMPH on 9/21/18, 12/21/18. Mnkd needs the insulin to supply Brazil market besides the U.S.
SO said:
There will be a filing relating to the initiation of a phase 3 trial on Tre-T in the not too distant future, as well as possible applications for Mexico and Canada. These three binary events could provide equity appreciation leeway to see 14 million warrants exercised at $2.38 in the Fall. If that happens, the MannKind cash runway would extend to the end of Q1 of 2019.
we can likely see a small milestone payment on Tre-T in Q1 with the initiation of the phase 3 clinical trial, and a bigger payment a year later with FDA approval followed by a third in mid 2020 related to the launch.
Previous deals like the one with RLS were with upstart companies trying to find an identity. United Therapeutics is a sizable company that controls much of the PAH market. This new cachet can assist MannKind in trying to solve its finances by providing the company with better leverage in negotiating recapitalization, partnerships, and even future offerings. The emergence of a second product also allows the company to work toward development of other new products which could give a big boost to the viability of the company, and the equity it represents. Simply stated, this is a positive for MannKind, and while it is not the ultimate solution, it is a big step in a good direction.
I’d like to add a new global international Afrezza deal might be possible Covering the world but Brazil, India, Mexico, Canada, U.S. per MC discussion. This deal should have good upfront money.
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Post by sportsrancho on Sept 6, 2018 8:57:21 GMT -5
Excellent, thanks for posting lakers!
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Post by slugworth008 on Sept 6, 2018 9:22:59 GMT -5
I look forward to the day we are Deerfield free - The sooner the better. IMO
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Post by mnholdem on Sept 6, 2018 9:58:55 GMT -5
Mike Castagna seems to indicate that MannKind will be sticking with them for awhile. It occurs to me that Deerfield (under a confidentially agreement) must have been made aware of the imminent deal with United Therapeutics, which explains their willingness to renegotiate terms of the financial agreement.
In spite of all of our concerns about Deerfield's control of nearly 100% of MannKind's asset as collateral, in all fairness Deerfield could have shut the doors on MannKind a long time ago. Instead, they've enabled the company to make it to this point. I'm not suggesting that Deerfield is doing this out of the goodness of their heart because they are in the business of making money, but I would not put them into the same class of those institutions commonly called "predatory lenders" either.
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