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Post by MnkdWASmyRtrmntPlan on Mar 2, 2021 9:27:14 GMT -5
So between $193 million and $222 million in proceeds. Another $100 million from the plant sale/leaseback. MNKD had $67 million cash at the end of December. So we could suddenly be sitting on a war chest of $389 million? Sounds like this is the point where Mike gives himself a big freakin raise, and huge, huge bonuses! |
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Post by longliner on Mar 2, 2021 9:27:39 GMT -5
From Clan on ST
ANYONE spreading notion of debt conversion to shares is ignorant or lying.
Around 2026, MNKD, at its election, decides how called/due debt gets repaid. The debt holder does NOT decide. So, If
$MNKD
trades at $15/sh, debt holders will be repaid $5.21 for every $5.21 lent; not $15; not a share of MNKD.
UTHR royalties will be flowing in and the ability to rollover any unpaid debt will be easy in 2026.
So, No dilution. "Conversion" means nothing (as long as you believe MNKD w/b trading north of ~$6/sh in 5 yrs).
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Post by centralcoastinvestor on Mar 2, 2021 9:28:26 GMT -5
In my opinion, this was a great deal for MannKind. It solves any funding problems for the foreseeable future and provides a solid funding bridge until UTHR royalty payments begin coming in. The other thing it does for us is provide such a solid financial position that we can hold out on making partnership deals that are low balled. It puts Mike and the Board in the position of telling companies to take a hike on a deal if it isn’t a good one and hold out for better partnerships. It allows Mnkd to be more aggressive in advertising Afrezza, begin the Phase 3 Ped trials for Afrezza and continue the development of dozens of potential Technosphere drugs. This deal is very very good. The other thing that is nice, is that the deal is big. They did not nickel and dime another $25 million deal. They did it big enough to last many years if necessary. Yesterday sucked, but over the long term, this deal is good for MannKind and its shareholders.
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Post by geomean on Mar 2, 2021 9:51:59 GMT -5
What I like is if the stock price explodes, then about 4.5 years out, Mannkind can redeem the bonds for cash at 130%. X $5.31 x 191.8281 or roughly $1300 per $1000 face value, subject to yet undisclosed adjustments. Wouldn’t this be viewed favorably by the market and shareholders knowing that as the stock price increases, the likelihood or degree of additional share issuance declines? Does the large price drop yesterday ultimately result in a lower redemption price 4.5 years out and greater odds that Mannkind would redeem the bonds for cash? The SEC filing upon closing should permit definitive answers once the adjustment features are disclosed.
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Post by rfogel on Mar 2, 2021 10:03:45 GMT -5
Is the company planning on paying off the current debt/interest? 10-K shows about 120 million in debt plus accrued interest.
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Post by pat on Mar 2, 2021 10:05:32 GMT -5
From Clan on ST ANYONE spreading notion of debt conversion to shares is ignorant or lying. Around 2026, MNKD, at its election, decides how called/due debt gets repaid. The debt holder does NOT decide. So, If $MNKD trades at $15/sh, debt holders will be repaid $5.21 for every $5.21 lent; not $15; not a share of MNKD. UTHR royalties will be flowing in and the ability to rollover any unpaid debt will be easy in 2026. So, No dilution. "Conversion" means nothing (as long as you believe MNKD w/b trading north of ~$6/sh in 5 yrs). This sounds like a cap. These are often used in interest rate derivatives. You get the floating rate for the duration of the derivative, but that rate is capped at a certain level. I don’t know if these are normally embedded in convert bonds. But unless there is a term sheet floating around I question how anyone would know this right now? |
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Post by longliner on Mar 2, 2021 10:08:52 GMT -5
From Clan on ST ANYONE spreading notion of debt conversion to shares is ignorant or lying. Around 2026, MNKD, at its election, decides how called/due debt gets repaid. The debt holder does NOT decide. So, If $MNKD trades at $15/sh, debt holders will be repaid $5.21 for every $5.21 lent; not $15; not a share of MNKD. UTHR royalties will be flowing in and the ability to rollover any unpaid debt will be easy in 2026. So, No dilution. "Conversion" means nothing (as long as you believe MNKD w/b trading north of ~$6/sh in 5 yrs). This sounds like a cap. These are often used in interest rate derivatives. You get the floating rate for the duration of the derivative, but that rate is capped at a certain level. I don’t know if these are normally embedded in convert bonds. But unless there is a term sheet floating around I question how anyone would know this right now? I cut and pasted, I have nothing to add. |
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Post by factspls88 on Mar 2, 2021 10:11:11 GMT -5
Ah more salt in the wound. Sorry I have nothing constructive to add. Just keeping my fingers crossed that there is something positive associated with the debt.
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Post by celo on Mar 2, 2021 10:11:54 GMT -5
Mannkind is crazy.
Not including this in their annual report to discuss.
Then pre-announcing the deal.
Then announcing the framework of the deal. All the while the share price crumbles.
It seems like a great deal, but for the common share holder it is hard to discern. I bought more but, it would be nice to have a little guidance through all these press releases.
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Post by dh4mizzou on Mar 2, 2021 10:15:21 GMT -5
curious, would anyone think the analogy 'ripping off the band-aid to get the wound to heal quicker' applies here?
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Post by longliner on Mar 2, 2021 10:18:52 GMT -5
From Keltic on ST
According to the agreement if the stock price is above $11.99 for 20 of 30 days after 3/6/24 and any time before early Jan/26. Mankind can choose to redeem for cash. That would result in no or little dilution. I'm thinking it should be well above $12 before the beginning of that period. The redemption terms would be totally up to Mannkind, if those conditions are met. Feeling much better about this deal. With Peds, deal with UTHR, RLS, and Vertice along with money to push Afrezza better, they should be well into the green.
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Post by pat on Mar 2, 2021 10:24:59 GMT -5
From Keltic on ST According to the agreement if the stock price is above $11.99 for 20 of 30 days after 3/6/24 and any time before early Jan/26. Mankind can choose to redeem for cash. That would result in no or little dilution. I'm thinking it should be well above $12 before the beginning of that period. The redemption terms would be totally up to Mannkind, if those conditions are met. Feeling much better about this deal. With Peds, deal with UTHR, RLS, and Vertice along with money to push Afrezza better, they should be well into the green. If true, awesome. |
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Post by babaoriley on Mar 2, 2021 10:33:51 GMT -5
At first look, the terms are far better than I feared. But I believe a lot of the commentary on the terms here is either incorrect or misleading. The holders have about a 4 month window to convert with no restrictions beginning Dec 1, 2025, and the maturity date. So if the stock is at $10, they convert at $5.21 and either then hold or sell the stock they received. Maybe mnkd has the option to pay them in cash, I’m not clear on that, but if so, they will be paying them $10 per share times the number of shares they could have bought had they converted their bond to stock.
$200 million - staggering. But it does speak highly for what these obviously (hopefully) sophisticated investors think of Mnkd’s future. I would say that the size of this price drop is not warranted.
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Post by longliner on Mar 2, 2021 10:37:58 GMT -5
From Keltic on ST According to the agreement if the stock price is above $11.99 for 20 of 30 days after 3/6/24 and any time before early Jan/26. Mankind can choose to redeem for cash. That would result in no or little dilution. I'm thinking it should be well above $12 before the beginning of that period. The redemption terms would be totally up to Mannkind, if those conditions are met. Feeling much better about this deal. With Peds, deal with UTHR, RLS, and Vertice along with money to push Afrezza better, they should be well into the green. If true, awesome. Again, cut and paste. I will quit that as I do not have any interest in misleading anyone nor do I know if I am. From here on out I will only cut and paste Baba. |
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Post by goyocafe on Mar 2, 2021 10:38:42 GMT -5
Ah more salt in the wound. Sorry I have nothing constructive to add. Just keeping my fingers crossed that there is something positive associated with the debt. Positive? Sure! MC will be able to upgrade his next stay at Holiday Express; plus a very nice bonus. |
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