Estimating Price At Fully Diluted Basis for MNKD

[harshal1981]

In this thread, I intend to invite people to go on some data digging and help through calculating what could be the pricing on Fully Diluted Basis. As of now we have 377 million Out Standing Shares As per ML Edge (which I find more reliable than yahoo/google etc.). Below is the historical data that found from FinanceGuru.com. However, I am more interested to find out what is the fully diluted share count. We know that upon approval, all the executives will receive huge amount of shares. On top of it, I don't know if DF dilution is included in the above 377 mil its total of $100 mil dilution attributed to DF deal. + $50 Mil ATM, + invariably Al's remaining credit line will be used and converted to shares - so additional $30 mil dilution. So not sure where we will stand in terms of share price after fully diluted basis upon approval. Please help me with any info that you have or you can dig up from SEC filings. 

MannKind Corporation Annual Shares Outstanding Data

                            Dec04 Dec05 Dec06 Dec07 Dec08 Dec09  Dec10  Dec11  Dec12  Dec13
Shares Outstanding  25.22  39.87  50.97  80.04 101.56 106.53 113.67 121.82 180.86 299.59

[Deleted]

Hi Harshal

An easy cap is, of course, the current authorized max 550M shares. Working back from that, we can get:


The last form 10-K shows 369,391,972 shares outstanding on 31 Dec 2013

Add to that:

2016 Warrants for 40M shares @2.60 /share

The latest $50M ATM, (say, 9M shares)


This takes us to 418 M shares by 2016 (including the 2016 warrants which we better hope will be in the money in 2016)


That much we know for sure.


What follows below is conjecture and should be viewed as such:


1. It's possible that $60M in debt has been converted by Deerfield (another 10M shares)



2. Yesterday, we got a hint of a pre-merger & acquisition form being filed by Al Mann. The last time we saw this was in 2012, linked to the issuance and private placement of 70M shares . I take this as a signal that financing could be coming (Regardless of MNKD saying it was just a renewal for a form "on file" - it just does not work that way). It makes sense - Mannkind does not have enough cash to make it to July, where Tranche A4 ($40M) and Tranche B ($80M) await from Deerfield contingent on approval.

If you were Al, how much would _you_ finance right now? The share price is relatively high, so even with a discount to market, a $250M financing would only chew up 40M - 50M shares.

This would take MNKD to 470M - 480M long term. Throw in 20M shares for "walking around money" for executives or for additional financing and you're neatly at 500M.


Edit: Just want to clarify the "How much would _you_ finance..." statement. What I'm getting at is not Al acting as a sugar daddy, but instead, how much would you want to finance in order to give MNKD financial stability to approval and the commercialization. I put out $250M as an estimate, (in addition to the $120M from Deerfield) since MNKD has a nominal cash burn of $12M / month ($100M until Q1 2015 launch) and will need to fund commercialization (stocking the supply chain, etc) and 2-3 quarters of sales before achieving free cash flow.