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Post by mnholdem on Apr 21, 2015 12:27:28 GMT -5
There is a thesis floating around on a couple forums regarding Al's borrowing shares to BofA and its relationship to the Aug 2015 Senior Notes.
The thesis basically states that the purpose for Al Mann to loan shares to the Bank of America was so that they could be sold short as a hedge to "Al's friends" - the holders of the Senior Convertible Notes. Bank of America presided over the sale during which MNKD stock was shorted at $5.55 per share.
Some believe since Al basically got nothing in return for borrowing the shares, that he was doing a favor for those handful of "friends" that bought the Notes. If this is true, then those friends can now cover those shares prior to a stock rally.
Please understand that I'm not accusing Al of providing insider information. What I am suggesting, though, is that this thesis may be one of the reasons why Al Mann and MannKind Corporation has not released any positive company news that would cause the share price to take off.
While it's true that the Notes don't mature until August, it may also be the case that the terms are currently being renegotiated and that those "friends" who hedged their Senior Notes with the borrowed shares are being given the opportunity to cover the hedge prior to news of new terms.
Just a thought, but there's little else to do whilst the clock ticks away...
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Post by _neil on Apr 21, 2015 12:34:37 GMT -5
I read the same theories too. Even though I'm frustrated with the stock rightn now, I can't bring myself to question Al's integrity.
Maybe it's time I start adopting the 'guilty until proven innocent' policy when it comes to this management- without exceptions
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Post by mnholdem on Apr 21, 2015 13:14:31 GMT -5
I'm not entirely certain that Mann' integrity is at question here. Perhaps he just wants to help everybody that has helped MannKind. I imagine that Al believes MannKind's retail investors will be handsomely rewarded eventually, but his management team must first restructure the debt. Maybe I'm becoming a cold, hard-hearted businessman, but I don't see any ethics issue with this thesis.
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Post by notamnkdmillionaire on Apr 21, 2015 13:23:56 GMT -5
I read the same theories too. Even though I'm frustrated with the stock rightn now, I can't bring myself to question Al's integrity. Maybe it's time I start adopting the 'guilty until proven innocent' policy when it comes to this management- without exceptions All is a business man and not a boy scout. I think Al's integrity isn't as golden and perfect as you think. No business man's is. That's not saying he is a scoundrel but that I think he has made business decisions that might not be as palatable as you would hope but none the less legal and needed to be done for the company. Remember, management has said things that turned out not to be true. Remember that minimally dilutive promise that was broken? i |
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Post by dstevenson on Apr 21, 2015 13:25:16 GMT -5
I don't think I can believe that one bit. That will put his integrity into question immediately. As tight lipped as they think things can be, it just takes one person who knows what's going on and the whole thing will be a red flag all over and it will destroy his company and his name. His legacy isn't about the rights he did but he will be remembered for helping friends out, I really find that hard to believe.
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Post by BlueCat on Apr 21, 2015 14:51:49 GMT -5
Grey area perhaps.
He may not have done it specifically so they could short it, or to help the friend hedge. But it may be a choice he made that he knew would result in it - but he had to choose the lesser of evils. Sometimes, there is no good answer, whatever the intent is in business.
That said - yea. Business is a good topic of many an ethics conversation, for sure ...
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Post by newmnkdinvestor on Apr 21, 2015 16:11:44 GMT -5
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Post by mnholdem on Apr 21, 2015 16:41:00 GMT -5
I should clarify that when I wrote "Al's friends" I wasn't suggesting that Mr. Mann thinks any less of retail investors. In fact, I strongly suspect that he considers us as friends, too. I just think Al Mann is the kind of guy who would want to reward everyone who supported this company.
The funds always seem to get the best of any situation, but in the case of MannKind Corporation, I think retail investors that don't lose heart will be handsomely rewarded.
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Post by BlueCat on Apr 21, 2015 17:01:01 GMT -5
I should clarify that when I wrote "Al's friends" I wasn't suggesting that Mr. Mann thinks any less of retail investors. In fact, I strongly suspect that he considers us as friends, too. I just think Al Mann is the kind of guy who would want to reward everyone who supported this company. The funds always seem to get the best of any situation, but in the case of MannKind Corporation, I think retail investors that don't lose heart will be handsomely rewarded. Yea - holdem, didn't take it that way. What I meant to say was that if MNKD needed the funds, in order to get them, they may have set themselves upon a path that they knew could go in this direction. Some have said that Old Mann has no love for shorts. Imagine if he knew that he, out of necessity, would be giving them a lending hand, but it was the best option he had on the table to achieve the objectives - at that time. Just as I'm out of my depth on the biology, may be here as well on the finances of it - so - throwing the proverbial pasta on the wall, as it were. |
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Post by EveningOfTheDay on Apr 22, 2015 1:21:30 GMT -5
I don't think I can believe that one bit. That will put his integrity into question immediately. As tight lipped as they think things can be, it just takes one person who knows what's going on and the whole thing will be a red flag all over and it will destroy his company and his name. His legacy isn't about the rights he did but he will be remembered for helping friends out, I really find that hard to believe. As someone has already pointed out, Al is not a boy scout but a businessman. He is not a politician either so if this was to be know to be true, I seriously doubt it would taint his reputation, his legacy or anything else. I have no idea if this is true or just another mental fart of a hyperactive mind in YMB, or wherever this comes from, but I would find it totally plausible that Al, at this point, would decide to reward those that actually helped the company when its situation was of life or death. Actually it would be perfectly justifiable. However, I seriously doubt Al would risk any legal ramifications, so if the story has any merit, I am sure it was either blessed by lawyers or never happened. |
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Post by mnholdem on Apr 22, 2015 5:04:20 GMT -5
Getting back to the main point of his thread. The borrowed shares were lent to BofA at $5.55 per share (read link above) so the borrowees are in the money and could either cover at this point for a profit if they suspect the pps is about to take off or they could continue to hold as a hedge. My point was that they are being given a gift with the sp dropping to $5.
Hopefully longs don't have to wait much longer for their reward. Some say wait until August when the Notes mature. I think MNKD starts climbing its way back up before August.
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Post by dstevenson on Apr 22, 2015 7:03:28 GMT -5
I think if they wanted to cover they would've done so. The share price has been sub 5.6'5 for some gime
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Post by BlueCat on Apr 22, 2015 11:21:26 GMT -5
Yep. Reading the link I think they needed the money and went with the best option they had. And unfortunately, it metastasized.
They could cover - but are probably waiting to make a few bucks more since GS is certainly willing to help them out.
I suppose it could be fair to say August may be worst case. By then, DTC should be starting and notes mature. I'll figure on worst case, but would love to be pleasantly surprised.
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