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Post by hankscorpio7 on Nov 10, 2015 11:12:33 GMT -5
What I find really distasteful is the way Matt is answering questions through email with very specific and likely misleading answers. For instance, he stated in email that the listing would not result in dilution, but failed to mention that being added to the indexes would result in dilution. Similar to the statement he made earlier about how a specific number of employees were not laid off - but a different number was. That was the tell. He phrased it in a way that you could read between the lines. First, he defined what dual listing means. Then seemed like he was answering if he had said we would not need dilution- never said no dilution. Not sure where that fits with disclosure rules.
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Post by cfield23 on Nov 10, 2015 11:37:06 GMT -5
Thanks rockstarrick! One other thing I was curious about .... hear me out: Here's a quote from Matt from yesterday's call: "We expect that the majority of shares for index fund purchases will be issued directly for MannKind, with remaining demand required to be satisfied by open market purchasers from existing holders to fulfill these ownership requirements. All purchases are expected to be completed within the next week." -- SourceSounds to me like 50M shares might not cut it! ETFs balance on a overall % of their funds, not on a total # of shares basis. Therefore, there are two ways to look at what might happen: In the filing, MNKD says expected amount is up to ~$140M. Now, 50M shares at $2/share is less than at $3/share. At the $2/share, if the ETFs have a percentage holding goal for MNKD (which I'm sure they do), they'll need to buy more than the 50M shares to satisfy the same % holding. So, from the shorts' perspective, knocking down our price is good in that we'll get less capital from the offering, but it's also potentially bad as more than 50,000,000 shares might be gobbled up by the ETFs, and since they're long-term holders and cannot lend them, that'd mean less available shares to short for the shorts. Thoughts? Corey, Perhaps I am NOT connecting the dots, but are you implying that, should not the 50,000 shares sell at a price high enough to satisfy the percentage goal that the ETFs must fund, they will need to go to the open market to fulfill the balance of this requirement? Depending upon how much is left, this could have a positive impact? Yes - if you read what Matt says, "We expect that the majority of shares for index fund purchases will be issued directly for MannKind, with remaining demand required to be satisfied by open market purchasers from existing holders to fulfill these ownership requirements. All purchases are expected to be completed within the next week." Basically, the ETFs need to come up with at total $ amount invested in MNKD, regardless of # of shares. If price per share goes down, it will take more shares to satisfy that overall $ amount or % of each ETF -- thereby needing more shares. If there are more shares bought by these long term holders who cannot lend or short, then there will be less shares available to short by the current shortsellers! Does that help make sense?
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Post by seanismorris on Nov 10, 2015 11:50:01 GMT -5
The duel listing was a sneaky way to raise money. My bet it's a loophole that will soon be closed. In fact, I'd bet it would not have happen if Al wasn't around. It's a bit of a concern MannKind is still riding on Al's coattail and credibility. It also seems an expensive way to raise money and a concern that no one else wanted to work a deal...
I figure Afrezza needs to be at 1B in sales by the end of next year to cover costs (overhead + new trial expenses, etc.) I'm pessimistic that's going to happen. So, more dilution next year? We need a big partner announcement soon (for credibility) or raising more is going to be a big problem.
I'm happy about our continued survival (near term) but BOY does management need to start executing...
You know my feelings about management. I'd like a merger to occur, perhaps with another company in Israel that Al has an interest in...so we can get a real CEO.
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Post by jpg on Nov 10, 2015 15:55:33 GMT -5
The duel listing was a sneaky way to raise money. My bet it's a loophole that will soon be closed. In fact, I'd bet it would not have happen if Al wasn't around. It's a bit of a concern MannKind is still riding on Al's coattail and credibility. It also seems an expensive way to raise money and a concern that no one else wanted to work a deal... I figure Afrezza needs to be at 1B in sales by the end of next year to cover costs (overhead + new trial expenses, etc.) I'm pessimistic that's going to happen. So, more dilution next year? We need a big partner announcement soon (for credibility) or raising more is going to be a big problem. I'm happy about our continued survival (near term) but BOY does management need to start executing... You know my feelings about management. I'd like a merger to occur, perhaps with another company in Israel that Al has an interest in...so we can get a real CEO. We don't need 1 billion is sales but a trajectory suggestive Afrezza will be a blockbuster. If we have that than all is good. Money will not be an issue. As far as new management to execute, the ball is in Sanofis camp so not our management. What our management controls is financing and partnerships...
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Post by james on Nov 10, 2015 15:59:02 GMT -5
There are not $1B in annual costs to the joint venture. This figure is more in the vicinity of $100 - $150M. The sales trajectory simply needs to show that it can achieve that in a reasonable amount of time; perhaps 2 to 3 years.
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Post by mdcenter61 on Nov 10, 2015 16:03:14 GMT -5
The duel listing was a sneaky way to raise money. My bet it's a loophole that will soon be closed. In fact, I'd bet it would not have happen if Al wasn't around. It's a bit of a concern MannKind is still riding on Al's coattail and credibility. It also seems an expensive way to raise money and a concern that no one else wanted to work a deal... I figure Afrezza needs to be at 1B in sales by the end of next year to cover costs (overhead + new trial expenses, etc.) I'm pessimistic that's going to happen. So, more dilution next year? We need a big partner announcement soon (for credibility) or raising more is going to be a big problem. I'm happy about our continued survival (near term) but BOY does management need to start executing... You know my feelings about management. I'd like a merger to occur, perhaps with another company in Israel that Al has an interest in...so we can get a real CEO. We don't need 1 billion is sales but a trajectory suggestive Afrezza will be a blockbuster. If we have that than all is good. Money will not be an issue. As far as new management to execute, the ball is in Sanofis camp so not our management. What our management controls is financing and partnerships... I agree with your points, JPG; as far as what our management controls (finance and partnerships), I'm less than thrilled given the ham-handed way the debt payoff/restructure was handled, resulting in more dilution than we would have had if we just came off our conversion price back in August/September, and as for partnerships, Hakan's "lets talk" statement/plea was cringe-worthy to my ears. I'm hoping we can get on past the TASE stock issue into better days with increasing scripts and maybe, just maybe, a TS partner a bit down the road. Cheers to all longs, and a pox on shorts. I'm holding to the end, joyous or bitter! I am very happy that this new dilution is not bailing out short positions!
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Post by seanismorris on Nov 10, 2015 16:42:38 GMT -5
$100M-$200M Afrezza sales comes no where near covering the costs. MannKind only gets one third, and costs for TS trials is going to dramatically increase costs; assuming they actually advance the three prospects. Of course, they may not have any trials until late next year which would be an even worse situation. My point is Afrezza sales need to explode up words next year otherwise they will be in deep trouble by the end of next year.
MannKind remains a poor credit risk without a partner, because if no partner shows up (by let's say March) that means TS isn't as valuable as we think.
My 1B (thrown out there) was a trajectory I'd want to see if I was going to loan MannKind money. If I could see 1B in peak sales for Afrezza with the next few year, MannKind will find a way to survive. If they don't, they probably won't.
The question we need to ask ourselves as investors: Is MannKind worth 1B with the information we have right now? Until we have a partner or Afrezza sales accelerate, my answer is no. While personally I'm holding on until early next year, I couldn't recommend MNKD to anyone even as a speculative stock. Conclusion: Investors are in for more pain.
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