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TW, they have home use China clearance for their food detective kit, the country has 120M diabetics, can only guess how many are metabolically unwell in total ?
With £10M annual sales @ 55% gross there may be an operator somewhere who thinks they can exploit better than Omega? Would we achieve 3X Rev for a consumer health product ?If we can show revenue growth for 2022 we could see a much higher valuation for this division than our current m/cap
Then we have Alva and our LFT a capacity, has to be attractive to an overseas operator who can secure U.K./ EU Government contracts - like Innova with their £300M contract this week
Politically it could be a shrewd deal for one the many Chinese suppliers, they could set up their own plant but Omega is plug & play so to speak.
It is primarily a manufacturing company, they hold some IP, possibly the food detective stuff, I'm unsure was that bought in tests or designed in house and the visitect test is a re-working of a mologic test so not sure how much value is in having access to the test.
So as a takeover target, it is primarily for their 660K of capacity and potentially another 1.3M if they can come to an arrangement with UK gov. Given that only Surescreen is knocking out covid LFTs in the uk, and they announced plans for 14M-20K a week by the end of 2021 (who knows if they got there), is there really a big buyers market out there for UK lft manufacturing ?
Sorry Okehurst but I just don’t see this happening - potentially a take over target at this price but splitting it up, I feel is unlikely and dare I say unwarranted. Putting aside now historic issues of poor communication pushing up the SP on what turned out to be false hope fired by a government contract that despite everything came to nothing the worldwide market for LFT is still there. I believe we have the capacity to produce 100m tests per annum and can probably do this as well as anyone for a price that is competitive. If/when approvals land the opportunity is still substantial within the Covid market in addition to the other avenues in which ODX is already involved. Approvals open the market to us - press speculation is that a pack of 7 tests will cost the public £30, that is £4.28 per test - we can do that and with the right approvals there is no reason why we could not be listed as a supplier and that together with the testing still required for air travel to other countries, NHS requirements, probably the civil service, teachers, fire services and police (whose unions will probably insist of free testing) let alone general testing here and abroad our 100 million, a drop in the ocean, could finally be required and wanted. I believe we have enough cash, properly managed, to get us through, it is as it always was about achieving approvals.
Who knows maybe Dam Health may be looking to buy something if the value keeps dropping...
Imho Woodstock i think theres a fund or two clearing out at any price.
Hey Woodstock hope your well, good to see your about. Yes DEV days proved very profitable. You still own ?
Bottom feeding here 2 as i feel the technicals are showing a turning point and we are seeing Capitulation
Omega are still at litlteport. There move to bigger premises at Ely hasn't happened yet.
JohnHenry. Hello chap. Long time since the Dev days.
I sold Odx at 96p. I am bottom feeding this stock right now.. I believe King having stepped down could be a good thing.
Warm regards
The Chairman is relatively new to Omega all about reputation for these guys as they have multiple positions
he has a decent CV to be fair - only as good as their last bad gig
He has shown this week he’s not afraid to act, he disposed of the CEO & a non exec director , Jag is a stand in whilst he formulates his strategy.
Breaking up/ disposal of the business looks the only forward without a large sales contract to justify a rights issue
This will sink to 5p now, a depressing shambles of a company.
Its the Covid LFT thats in tatters
Fair comment John
Sell off CD4 it enjoys HUA in China - only test that enjoys this status apparently ?
Colin was only forecasting £18M revenue in a few years, a new savvy owner could well exploit the opportunity better than Omega
Then highest bidder for Alva, put the operation up for sale within the industry , now is the time
'this Chairman doesn’t look like he messes about and is not here for a salary'
Can you explain on what grounds you deduced this gibberish? ODX has no profitable business and its LFT endeavours are in tatters. It has enough cash in the bank to keep paying salaries short term. Of course the chairman is here for a salary.
Imho ODX would be a good fit for NCYT ( massive cash pile)
Some musing ,is there now more value in this route below considering we have a £25M m/cap today ?
Value of the kit installed by DHSC , £17M has been quoted but who knows ? Do we have to give it back ?
Cash £2.5M - we now know
WIP ( work in progress) manufacturing CD4 LFT’s for distribution/ stock - what the 150 staff are working on ?
Put aside the labs/ infrastructure/ their own kit
The Chairman could look to sell the CD4 division £10M a year Rev @ 55% gross , possibly link disposals with Cambridge Labs thrown in?
Then sell Alva as a going concern, maybe 2 year contract to supply the new owner of CD4 ,assume a savvy investment bank or industry player could negotiate the purchase of the £17M of kit at a big discount ? What’s it worth to DHSC? Going to cost a few Bob to remove / store etc , they could nick the lot
The Alva site has 100M capacity, Innova just picked up another £300M contract this week, on boarding part of their operation - or any Chinese Co in the space - then Alva has plug & play play political advantages
The company won’t be able to raise ££ without a commercial reason like a large sales contract, this Chairman doesn’t look like he messes about and is not here for a salary, reputation is important - as we have seen this week
What £value is placed on the sun of the parts above ?
There are tax implications on disposals ( capital gains ) which can’t be offset against trading losses but if structured correctly the new owners could purchase the shares of Omega - sure there is a way
Bottom line … is Omega now a breakup / a sale play ? Feels like it