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Post by Deleted on Jun 22, 2017 7:15:11 GMT -5
Kastanes. Castagna. Hmmm. If I were Mike and wanted to post I wouldn't use my real name. I'd change it up a little bit. Hmmm. Our names would have been even more similar if it had been properly translated at Ellis Island: Kastania.
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Post by mnholdem on Jun 22, 2017 7:37:52 GMT -5
There WAS a famous short squeeze involving Volkswagen in 2008, but that was because Porsche made a takeover play. Porsche and its executives later faced lawsuits for market manipulation (afaik they were acquitted, but it was a long battle). Porsche actually lost the takeover attempt, though the two companies later merged in 2012. The financial press described it as Volkswagen swallowing Porsche, but that may not be completely accurate I'm not 100% sure. But that whole scenario was so far from Mannkind's current situation, that any comparison is ludicrous. It would be like Sanofi coming back to make a takeover attempt, then being taken over by Mannkind or merging as 50/50 partners. Agreed - there is no comparing the MannKind situation today to what Porsche pulled off. In fact, if Pro-Board members would research that 2008 Volkswagen squeeze they would discover that the methods used by Porsche are illegal in the U.S. stock market exchanges. Here's an excerpt from a 2008 NY Times report that helps explain how they pulled it off:
NEW YORK — On Wall Street, a corner is not just an intersection of two streets. It is also a way to extract huge profits from speculators who had the temerity to sell a stock short.
Now the question is whether Porsche has pulled off a brilliant new-fashioned corner in Volkswagen stock, using derivatives in clever ways that no one had thought of before, or whether it was too clever for its own good.
In a corner, a buyer or group of buyers purchases a lot of stock. As the price goes up, short-sellers appear. They borrow stock - perhaps from the very same group - and sell it, hoping to make a profit when the price declines.
Then comes the squeeze. The group, which now owns more shares than exist, demands the return of the borrowed stock. The only way the short-sellers can comply with that request is to purchase shares, and the only one who has shares to sell is the corner group. The group can set its own price and make a fortune.
One reason you don't see many corners these days is that they are illegal in most countries. But another is that almost everybody involved tends to lose in the end, with the exception of lucky investors who happened to own the stock before the fun started and can sell into the big run-up in prices.
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Now, from Germany we have a new version of the corner, using derivatives in a way that may have removed much of the risk for the people planning the corner.
Briefly, here are the relevant facts. Porsche, for some reason, wants to control Volkswagen, and by building up its stake has driven up the price. Hedge funds, figuring the share price would fall as soon as Porsche got control and stopped buying, sold a lot of VW shares short.
Then last weekend, Porsche disclosed that it owned 42.6 percent of the stock and had acquired options for another 31.5 percent. It said it wanted to go to 75 percent.
The result: instant short-squeeze. The German state of Lower Saxony owns a 20 percent stake in VW, which it said it would not sell. That left precious few shares available for anyone else. The shorts scrambled to cover, and the price leaped from about €200, or about $265, to above €1,000. VW became the world's most valuable company, if you believed that market price.
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In the United States, there are numerous laws and regulations to stop corners. But Porsche insists that it broke no German laws, adding that "allegations of price manipulation by Porsche are therefore without any foundation whatsoever." It placed the blame on - you guessed it - "speculative short-sellers."
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NOTE: Today's SEC regulations, particular those which requires public disclosure whenever a company/firm owns more than 5% stock, would prevent any company from discretely accumulating MNKD stock in order to force a squeeze by being in control of share price. A natural short squeeze may occur - simply because the large percentage of short interest in MannKind could result in a shortage of shares for covering to get out of a short position - but the way in which Porsche acquired Volkwagon and made $billions in the process could never happen in the USA.
BTW - Immediately after its historic short squeeze, Porsche executives hedged the company's shares and made several $billions more when the share price dropped. It was a brilliant strategy that took advantage of loopholes in German trading regulations.
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Post by silentknight on Jun 22, 2017 8:18:20 GMT -5
My response to the original question posed by Kastanes can be found in one of my posts that was titled "Once a CEO, always a CEO which Matt (poster, not former CEO) eluded to. Mike put himself in a prime position if Mannkind tanks. I have yet to see him accomplish anything that helps the company near term. Ok so we're sponsoring a reality TV show, we have our own sales force instead of a contract sales force, we have a DTC commercial coming out soon and have an agreement for Afrezza in Brazil. That's a lot of "stuff" but does any of it really help us short term? The answer to our problems (which I have repeated ad nauseum) is, we need to sell the product! I agree with falcon here. While Mr. Castagna's passion and drive are without question, his actual quantifiable results for accomplishing what his sole purpose was for coming into MNKD to begin with (sales of Afrezza) have been extremely unimpressive. He's had 18 months almost to increase sales and the numbers of scripts haven not changed in a significant way. The revenue per script may be up, but that's hardly enough in my opinion to justify a promotion to a chief executive. Matt was inexperienced for the position, and so is the current CEO. Quite frankly, Mike hasn't done anything to deserve his current position in my opinion. I would have graded his performance as a CCO with a firm C-, but I guess that's good enough to get you a CEO job in the business world, or at least it will at MNKD.
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Post by oldfishtowner on Jun 22, 2017 8:39:22 GMT -5
In this thread and others there is much speculation on how MNKD will survive, but rational suggestions are quickly ignored for more tantalizing suggestions of buy outs, bankruptcy, etc. While Deerfield is mentioned on occasion in other threads discussing MNKD's cash problem, there is not one mention here.
Deerfield can demand payment in July or take a debt-for-equity exchange as it did before. I believe there is a good chance that Deerfield will exchange debt for equity and furthermore will provide MNKD with another $40 to $60 million through a convertible note with a conversion price of $2/share or higher. Dilution will be moderate, but certainly not enough to benefit shorts who were waiting for the cash raise to close their positions. Rather, the easing of MNKD's cash problem and the UAE approval that I believe will shortly follow (not to mention Reversed and DTC) will push the PPS well beyond whatever price erosion might have resulted from dilution.
Those with open short positions remaining after the financing deal would be inviting disaster to hold on to their positions with the label approval due in September, the time-in-range study results due a month or two later and a possible approval in Brazil by the end of the year. This is why I think there is a 50% chance that shorts will not be able to exit gracefully if they are expecting a financial disaster for MNKD in July.
Deerfield did well with their earlier debt-for-equity exchange. I think they will do much much better with another in July and that is why I think it will happen.
Matt P. is the one with the history with Deerfield. IMO he likely will have had a hand in the July exchange if it takes place.
While Castagna will be the one who makes Afrezza a commercial success, assuming that is what the future holds, Pfeffer, IMO, is the one who kept the lights on at MNKD so Castagna could work his magic.
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Post by Deleted on Jun 22, 2017 8:47:28 GMT -5
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Post by sportsrancho on Jun 22, 2017 8:51:19 GMT -5
In this thread and others there is much speculation on how MNKD will survive, but rational suggestions are quickly ignored for more tantalizing suggestions of buy outs, bankruptcy, etc. While Deerfield is mentioned on occasion in other threads discussing MNKD's cash problem, there is not one mention here. Deerfield can demand payment in July or take a debt-for-equity exchange as it did before. I believe there is a good chance that Deerfield will exchange debt for equity and furthermore will provide MNKD with another $40 to $60 million through a convertible note with a conversion price of $2/share or higher. Dilution will be moderate, but certainly not enough to benefit shorts who were waiting for the cash raise to close their positions. Rather, the easing of MNKD's cash problem and the UAE approval that I believe will shortly follow (not to mention Reversed and DTC) will push the PPS well beyond whatever price erosion might have resulted from dilution. Those with open short positions remaining after the financing deal would be inviting disaster to hold on to their positions with the label approval due in September, the time-in-range study results due a month or two later and a possible approval in Brazil by the end of the year. This is why I think there is a 50% chance that shorts will not be able to exit gracefully if they are expecting a financial disaster for MNKD in July. Deerfield did well with their earlier debt-for-equity exchange. I think they will do much much better with another in July and that is why I think it will happen. Matt P. is the one with the history with Deerfield. IMO he likely will have had a hand in the July exchange if it takes place. While Castagna will be the one who makes Afrezza a commercial success, assuming that is what the future holds, Pfeffer, IMO, is the one who kept the lights on at MNKD so Castagna could work his magic. Great post!
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Post by aquanet on Jun 22, 2017 8:53:44 GMT -5
Oldfishtowner
Been an owner for years. Visit the board everyday but never post.
What you laid out hit me last week. I bought 175 Aug $3 calls.
Willing to wager the 1K that the se stop plays out
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Post by matt on Jun 22, 2017 9:30:47 GMT -5
I believe there is a good chance that Deerfield will exchange debt for equity and furthermore will provide MNKD with another $40 to $60 million through a convertible note with a conversion price of $2/share or higher. I partially agree with that statement, but not with all of it. Deerfield gains nothing by forcing Mannkind into insolvency so it is in their enlightened best interest to agree to a debt for equity exchange. If Deerfield refuses to do that, then Mannkind can sell shares to somebody else for cash and use the cash to pay off Deerfield so that is essentially the same transaction minus a 7% placement free from the bank. Either way, I expect shares to be issued to satisfy that $10 million of debt coming due. What I don't see happening is Deerfield loaning more money, and certainly not on a convertible. Mannkind is almost out of authorized shares, and an debt for equity deal on the $10 million will use up nearly all of the shares remaining. Remember that for every warrant, option, and convertible note already issued, Mannkind must legally reserve shares for those contingent issuances even if they are presently underwater with respect to the conversion or exercise price. Given that the authorized shares are almost gone, Mannkind can't do another convertible security without calling a special shareholders meeting to authorize an increase in shares. Similarly, Mannkind cannot sell equity in any significant amount without more authorized shares. It takes roughly a month to call a special meeting and to solicit proxies, so a meeting to authorize additional shares is a late July / early August event at the earliest. That aside, Deerfield is a debt fund that is already overexposed to Mannkind, and the assets securing the existing notes have been written down by the auditors. A bond fund has fiduciary obligations to protect their investors and, regardless of how well Deerfield have done in the past, prudential underwriting would preclude them from further increasing their exposure to Mannkind due to lack of collateral. A different bond fund that does not already have an exposure and different collateralization rules could step in, but given the seniority and security positions that Deerfield and The Mann Group have, that new money would be junior subordinated debt which would come with very tough terms and a high interest rate. The shareholder equity was already negative $198 million as of the last 10-Q, and will surely be negative by more than $200 million by June 30, so getting more debt on commercially acceptable terms is not realistic.
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Post by tw12 on Jun 22, 2017 9:36:42 GMT -5
Oldfish:
Well stated! I believe both Matt and Mike have been doing all they can this past year to keep MannKind independent.
In fact, as a stockholder with a long view, I try to help make that happen by proactively talking about Afrezza every day. I encourage the thousands of members (2,915) and guests here on ProBoards to do the same, not only because it helps of course to get this life-changing drug to the over one billion people with diabetes or pre-diabetes on this planet, but also because it’s an easy and effective bit of real-world marketing support for Mike and his team as they do their best to max out our financial return by maintaining our independence.
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Post by rockstarrick on Jun 22, 2017 9:41:00 GMT -5
any company who buys MNKD now can get 50% of their purchase price refunded thru the short squeeze ... same thing Volkswagon did...google it How about you Google it and provide the link. You already sent me on a wild goose chase when you said to locate where the Mann Foundation bought 5 million more shares of MNKD after selling EYES stock. You still have not provided proof of that. Show me you're more than hot air Actually there has been an update on Institutional Ownership @ CNBC ?? not really sure what to make of this. You will see Al Mann listed @ the top of the list with 22.1 million shares, then listed again lower on the list with 1.7 million shares. I check this source frequently, they were the first to update the 5 million Deerfield shares. Large Block Owners 171 Total Number of Shares Held 47.7M % Change in Ownership 0% % Shares Owned 23% Monthly Rotation Number of Shares Value of Change (MM) % of Shrs. Outstanding Buyers 6/22/17 9,778,305 $17.84 15.8% Sellers 6/22/17 25,003,433 $123.52 33.7% Holdings chart Institutions 138 Holders Mutual Funds 108 Holders Other Major Holders 33 Holders SHAREHOLDERS CONCENTRATION 44.7% 1.2% TOP INSTITUTIONAL HOLDERS Concentration of Current % Held Top 10 Institutions: Ownership by top 10 institutions Top 20 Institutions: Ownership by top 20 institutions Top 50 Institutions: Ownership by top 50 institutions All: Ownership by all institutions Low Avg. Turnover Rating Name Shares Held Position Value Percentage of Total Holdings since 6/21/17 % Owned of Shares Outstanding Turnover Rating Mann (Alfred E) 22.1M $32,693,413 +46% 21.9% Low Deerfield ... 5.2M $4,557,913 +11% 5.2% Moderate BlackRock ... 3.4M $5,073,313 +7% 3.4% Low The Vanguard ... 3.0M $4,392,548 +6% 2.9% Low Alfred E. Mann ... 1.7M $8,650,131 +4% 1.7% -- Goldman Sachs & ... 1.6M $2,312,359 +3% 1.6% Low State Street ... 1.0M $1,522,846 +2% 1.0% Low Scopia Capital ... 982.9K $1,454,736 +2% 1.0% Moderate D. E. Shaw & ... 937.0K $1,386,742 +2% 0.9% Moderate Northern Trust ... 733.1K $1,084,935 Im pretty sure this is the first time since I've been invested that Al has been listed in more than one place. I wonder what changed ?? www.cnbc.com/quotes/?symbol=MNKD&tab=ownership&sub=holdings_summary
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Post by kbrion77 on Jun 22, 2017 9:48:37 GMT -5
I believe there is a good chance that Deerfield will exchange debt for equity and furthermore will provide MNKD with another $40 to $60 million through a convertible note with a conversion price of $2/share or higher. I partially agree with that statement, but not with all of it. Deerfield gains nothing by forcing Mannkind into insolvency so it is in their enlightened best interest to agree to a debt for equity exchange. If Deerfield refuses to do that, then Mannkind can sell shares to somebody else for cash and use the cash to pay off Deerfield so that is essentially the same transaction minus a 7% placement free from the bank. Either way, I expect shares to be issued to satisfy that $10 million of debt coming due. What I don't see happening is Deerfield loaning more money, and certainly not on a convertible. Mannkind is almost out of authorized shares, and an debt for equity deal on the $10 million will use up nearly all of the shares remaining. Remember that for every warrant, option, and convertible note already issued, Mannkind must legally reserve shares for those contingent issuances even if they are presently underwater with respect to the conversion or exercise price. Given that the authorized shares are almost gone, Mannkind can't do another convertible security without calling a special shareholders meeting to authorize an increase in shares. Similarly, Mannkind cannot sell equity in any significant amount without more authorized shares. It takes roughly a month to call a special meeting and to solicit proxies, so a meeting to authorize additional shares is a late July / early August event at the earliest. That aside, Deerfield is a debt fund that is already overexposed to Mannkind, and the assets securing the existing notes have been written down by the auditors. A bond fund has fiduciary obligations to protect their investors and, regardless of how well Deerfield have done in the past, prudential underwriting would preclude them from further increasing their exposure to Mannkind due to lack of collateral. A different bond fund that does not already have an exposure and different collateralization rules could step in, but given the seniority and security positions that Deerfield and The Mann Group have, that new money would be junior subordinated debt which would come with very tough terms and a high interest rate. The shareholder equity was already negative $198 million as of the last 10-Q, and will surely be negative by more than $200 million by June 30, so getting more debt on commercially acceptable terms is not realistic. Good post as usual. People need to understand Deerfield is not our friend and will not save MNKD, MNKD can only save itself through strategic avenues which at this point is a rabbit out of a hat. I'm sure we will see another round of short/convert/cover at a discount with Deerfield in the next couple weeks on the debt.
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Post by mnkdfann on Jun 22, 2017 9:51:53 GMT -5
How about you Google it and provide the link. You already sent me on a wild goose chase when you said to locate where the Mann Foundation bought 5 million more shares of MNKD after selling EYES stock. You still have not provided proof of that. Show me you're more than hot air Actually there has been an update on Institutional Ownership @ CNBC ?? not really sure what to make of this. You will see Al Mann listed @ the top of the list with 22.1 million shares, then listed again lower on the list with 1.7 million shares. I check this source frequently, they were the first to update the 5 million Deerfield shares. Large Block Owners 171 Total Number of Shares Held 47.7M % Change in Ownership 0% % Shares Owned 23% Monthly Rotation Number of Shares Value of Change (MM) % of Shrs. Outstanding Buyers 6/22/17 9,778,305 $17.84 15.8% Sellers 6/22/17 25,003,433 $123.52 33.7% Holdings chart Institutions 138 Holders Mutual Funds 108 Holders Other Major Holders 33 Holders SHAREHOLDERS CONCENTRATION 44.7% 1.2% TOP INSTITUTIONAL HOLDERS Concentration of Current % Held Top 10 Institutions: Ownership by top 10 institutions Top 20 Institutions: Ownership by top 20 institutions Top 50 Institutions: Ownership by top 50 institutions All: Ownership by all institutions Low Avg. Turnover Rating Name Shares Held Position Value Percentage of Total Holdings since 6/21/17 % Owned of Shares Outstanding Turnover Rating Isn't 'Position Value' the current market value? So why are some (most) of the position values calculated using apparently recent prices (about $1.5), others calculated using share prices far above (over $5) or below (under $1) current prices? Just wanting to understand the data.
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Post by rockstarrick on Jun 22, 2017 9:59:55 GMT -5
Actually there has been an update on Institutional Ownership @ CNBC ?? not really sure what to make of this. You will see Al Mann listed @ the top of the list with 22.1 million shares, then listed again lower on the list with 1.7 million shares. I check this source frequently, they were the first to update the 5 million Deerfield shares. Large Block Owners 171 Total Number of Shares Held 47.7M % Change in Ownership 0% % Shares Owned 23% Monthly Rotation Number of Shares Value of Change (MM) % of Shrs. Outstanding Buyers 6/22/17 9,778,305 $17.84 15.8% Sellers 6/22/17 25,003,433 $123.52 33.7% Holdings chart Institutions 138 Holders Mutual Funds 108 Holders Other Major Holders 33 Holders SHAREHOLDERS CONCENTRATION 44.7% 1.2% TOP INSTITUTIONAL HOLDERS Concentration of Current % Held Top 10 Institutions: Ownership by top 10 institutions Top 20 Institutions: Ownership by top 20 institutions Top 50 Institutions: Ownership by top 50 institutions All: Ownership by all institutions Low Avg. Turnover Rating Name Shares Held Position Value Percentage of Total Holdings since 6/21/17 % Owned of Shares Outstanding Turnover Rating Isn't 'Position Value' the current market value? So why are some (most) of the position values calculated using apparently recent prices (about $1.5), others calculated using share prices far above (over $5) or below (under $1) current prices? Just wanting to understand the data. I don't know, I just noticed Al listed in two different places on the list. It was never this way before,,,never.
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Post by aquanet on Jun 22, 2017 10:25:49 GMT -5
This will be my last post.
If I were Deerfield I'd buy another 5% of the company through debt to equity conversion. Then I'd loan the company some amount of money, making it clear more would be forthcoming if necessary. Short squeeze ensues and my 10+% stake would skyrocket in value. I'd let my compliance and legal departments work out how to allocate the gains amongst the various vehicles I manage.
Oh yeah, I'd spend the rest of the year in the islands having beaten every Market composite against which my performance is compared.
Guess we'll see.
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Post by factspls88 on Jun 22, 2017 10:28:02 GMT -5
This will be my last post. If I were Deerfield I'd buy another 5% of the company through debt to equity conversion. Then I'd loan the company some amount of money, making it clear more would be forthcoming if necessary. Short squeeze ensues and my 10+% stake would skyrocket in value. I'd let my compliance and legal departments work out how to allocate the gains amongst the various vehicles I manage. Oh yeah, I'd spend the rest of the year in the islands having beaten every Market composite against which my performance is compared. Guess we'll see. I thought I'd be in the islands a couple of years ago ![;)](//storage.proboards.com/forum/images/smiley/wink.png)
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