MannKind Announces Termination of Stock Lending Agreement

[rrtzmd]

Oct 26, 2015 11:23:41 GMT -5 jay1ajay1a said:

Oct 26, 2015 8:54:38 GMT -5 rrtzmd said:

I'm disappointed that they didn't provide more details as to how the debt itself was finally resolved. Investors are still left hanging a few more days until the 10-Q comes out.

Sorry you are disappointed, we know a fair bit about how it was resolved. I personal think it was a prefect announcement, just my humble opinion.   

I can't agree. The "perfect" announcement would have been one back in early August that the debt was settled as planned per MNKD's declaration on July 29 to the effect that $28 million would be rolled over into new, 2018 debt; that $57 million would be converted into MannKind equity; and that $15 million would be repaid with company cash.  

Instead, what investors got was an announcement two days before the debt was due that the refinancing was delayed, which, in turn, led to Goldman Sachs issuing a "note" that the delay was due to how slowly the Afrezza sales launch was "ramping." 

Then came plan "B" with the delay announcement on August 13: "$28 million rolled over into new, 2018 debt (done); 2. $8 million converted into MannKind equity (done); 3. $32 million converted into MannKind equity (ongoing); and 4. $32 million repaid with company cash (ongoing).They then said that $32 million of that was extended to Sept. 30. At that time, MannKind will attempt to exchange it for equity." That was followed a few days later by the headline, "MannKind Financial Woes Escalate on Failed Debt Settlement."

And when September 30 rolled around, did MNKD issue a PR reassuring everyone that the debt issue was resolved? No, instead investors were treated to a newspaper story to the effect that MNKD had laid off a third of its employees as a consequence of slow afrezza sales.

Indeed, no point could I find anywhere that the 9 million shares were ever an issue for MNKD's management, so why did they bother with a press release for them now? Instead, everyone is stuck waiting to see how Plan "B" worked out and its effects until the 10-Q. I still think a PR detailing how they managed Plan "B" would have been more useful.