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It's not totally irrelevant. If the Arix NAV increases then that will increase the NAV of the merged company, which will benefit us as future shareholders of that company.
Am I being thick here.
Any movement in either the SP or NAV is totally irrelevant with the share terms set?
Would be great to know how much Peregrine is getting paid for "loss of office" for doing a frankly poor job for shareholders (apart from the mates rates for some)
RTW on winterfloods IT recommendations for 24.
I wonder what this means to the RTW deal? Their SP had risen appreciably making me more inclined to vote yes, but now I'm not so sure. I wonder what Acacia are thinking about their cash deal?
Lovely that it's now moving as it should and in my opinion this share is due a big rerate upwards.
Thanks for the responses. Agricore, that article is a very good summary.
And now rimau1 on advfn has spotted this:
https://www.investorschronicle.co.uk/ideas/2024/01/08/an-arbitrage-opportunity-via-the-arix-rtw-deal/
According to Arix's interims it holds 5.8% of Harpoon. There was a $2.9m redeemable preference share in Harpoon it added during the period. However Harpoon's 8-Q shows shares in issue as of 07/01/24 are 16.95m (up from 4.1m) so ARIX holds a diluted 1.41% worth a £3.53m gain: ($680m x 1.41% = £7.53-£4m book). See:
https://open.substack.com/pub/theoakbloke/p/arix-merger-and-27m-gain-today
Sgd, you're well ahead of them.
Interesting seeing a few "experts" have RTW as their investment trust pick for 2024.
3.5% of Harpoon as per last half year results - a stake valued at £6.4m.
Https://www.reuters.com/markets/deals/merck-buy-harpoon-therapeutics-680-million-2024-01-08/
I'm surpised Arix haven't RNS'd this (yet?)
HARP SP doubled - anyone happen to know how many Arix holds?
Yes, incredible. Now equivalent to 159p on the bid price. Even after today's confirmatory RNS I must be missing something but will continue buying in my SIPP. Worst case scenario is the deal falls through but in the long term still trading at a huge discount to NAV and value will out in the end.
RTW(Bid) $1.32 x 1.4633 x 78.9p/$ = 152.4p ARIX
SGD. agree with oldnbald.
Compared to the rubbish on other boards its great seeing other people with insight and digging stuff up.
Great work, thank you! Please continue to share
FYI A quick scan of RTW's listed portfolio top 6: change from 1 month ago according to Google Finance:
RCKT +21.99%
IMCR +32.47%
CRGX +4.00%
MIST +12.05%
OBIO +22.11%
APGE +29.34%
Https://www.londonstockexchange.com/news-article/RTW/monthly-valuation-update-november-factsheet/16251440
RTW NAV $1.65/share, up 11.9% vs last month
RTW SP(Bid) $1.24
RTW Discount -25% (12 month average -23.4% according to HL)
Deal calculation:
$1.24 x 1.4633 x 79p/$ = 143p
I think the big RTW NAV increase is plausible, as the whole sector seems to be improving at last. E.g. their portfolio company Immunocore is up 32%:
https://www.google.com/finance/quote/IMCR:NASDAQ?window=1M
If this continues, then despite being unhappy about the principle of the deal, the rational investor in me might be voting in favour.
SGD.
I did write to investor relations about 2-3 weeks ago asking why the directors were in favour of this deal, as I couldnt work it out.
Clearly "other incentives" for the board somewhere.
Here's the bit visible before the subscription barrier comes down:
"
BUSINESS COMMENTARY
Thorny case for Arix chief to answer
Alistair Osborne
Tuesday December 05 2023, 12.01am, The Times
Corporate deals throw up all sorts of governance questions. But here’s a simple one: should a chairman be more obviously independent before he recommends a transaction that discriminates against three quarters of the shareholders?
It’s the puzzler raised by the delightfully named Peregrine Moncreiffe of that Ilk, the mullet-coiffured Scottish clan leader atop the board of Arix Bioscience. A month ago, he recommended a deal that flouted a crucial tenet of UK corporate life: that all shareholders must be treated equally. Moncreiffe endorsed the sale of all the group’s assets to a rival life sciences investment company, RTW Biotech, saying the transaction was the “best outcome for Arix shareholders”.
Well, maybe for one of them. Under the terms, RTW is buying out Arix’s biggest shareholder
"
And another :
https://www.thetimes.co.uk/article/thorny-case-for-arix-chief-to-answer-p7xgbm6zs
(And again ohisay on advfn has provided an extract for the unsubscribed.)
Yes, RTW is now more or less back to the price used in the the 'indicative value' calculation. If only the exchange rate could also revert* then this might not look quite such a terrible deal. Like others, I'm surprised that the market isn't seeing what looks like an obvious arbitrage opportunity.
* Now ~78.8p/$ whereas they used 82.5p/$ which was something like a past month average at the time.
With RTW shares heading up and if you want to be invested in the bioteck sector it seems to me to be a good time to buy more Arix ie. RTW at a nice discount or am I missing something.
Another article today, again spotted by ohisay on advfn:
https://www.thetimes.co.uk/article/arix-bioscience-boards-caribbean-meeting-left-shareholders-flabbergasted-gnxn539zp
"
Arix’s Caribbean meeting left shareholders ‘flabbergasted’
Alistair Osborne
Monday November 20 2023, 12.01am, The Times
An Arix Bioscience board meeting was arranged at a luxury hotel only a few miles from the holiday island of St Vincent
The under-fire chairman of Arix Bioscience held a board meeting in the Caribbean, despite the investment company having no business interests in the region.
Peregrine Moncreiffe — whose contentious deal to sell the life sciences specialist’s assets to RTW Biotech, a rival, triggered the immediate resignation of Peel Hunt as Arix’s joint-broker — chaired a board meeting on the island of Bequia. The outpost, covering only seven square miles and located nine miles from St Vincent, has been dubbed “the Caribbean’s best-kept secret” by Forbes magazine.
Held in February last year, the meeting took place at the luxury Bequia Beach Hotel, a five-star resort where beachfront suites cost $620 a night. The hotel’s publicity speaks of a resort set in “ten acres of beautifully landscaped
Continue reading
The Flash Sale.
£1 for 4 months.
Ends soon.
"
More cut&paste on advfn...
McNulty in Acacia seems like a right ****** by the way
SGD - thanks for this - Is there anyone we can write to in the FCA at this grubby little transaction ?
I wrote to investor relations over the weekend but have yet to have a response.
I did take a long look at the annual report to look at the directors remuneration to see the personal gain they would get at the expense of shareholders, as they are not acting as directors should. The terms of share options are a little murky.
It was interesting to see the notes on bonus, basically we'll ignore the terms of the performance bonus and pay the CEO double it anyway.
Https://uk.investing.com/news/stock-market-news/earnings-call-acacia-research-posts-q3-results-acquires-stake-in-benchmark-energy-and-announces-share-repurchase-program-93CH-3236714
"
Anthony Stoss: Got it. By the way, congrats on the Arix deal. That's wonderful for Acacia. One of the shareholders, it looks like, in Arix is kind of disputing the fact that you guys are getting cash, and others are getting stock. I'm curious if you can share your thoughts on that.
MJ McNulty: Yes. I mean we saw that news, too. I think they're a small broker that shouldn't take away from the value of their opinion. We are getting cash, and other shareholders are getting gig stock. Other shareholders have a say in the way that the deal ultimately happens. We did have a sizable position, and so we got a premium in terms of the consideration being cash instead of stock because of that position.
...
Brett Reiss: Okay. On a scale of 1 to 10, 10 being metaphysical certainty, what would you -- the Arix deal closing, what do you think it is, a 7, 8, 9?
MJ McNulty: I love it, Brett, when you ask me to put things on a scale. What I will tell you is that there is one condition to the closing of our, Acacia's Arix shares to RTW. And that is approval from the Financial Conduct Authority in the United Kingdom for the transaction. I will say that the entity within Arix that triggered this approval requirement is currently FCA-approved or certified as is RTW. So I don't want to handicap it, but we're being advised that this is a routine approval process by the FCA. Now it's -- there are things that are out of our control, but that's what we're being advised.
"