RE: RNS19 Sep 2024 10:05
Hi Bigpunt,
Reason I think its likely is actually their own performance to date. They have taken over quite a list of companies previously and ours is easily obtainable for a company with such a war chest as they have, which was over 500M.
In my humble view it does focus on actually how good our products performed in hard testing the results of which are being classed as "market sensitive ".
So lets put ourselves in their shoes, if our product does become adopted as a full mainstream ingredient and they have to pay high royalties to us why wouldn't you want full control and remove that cost.
Unless,
1. The positive effects are very minor indeed.
2. Not likely to become mainstream, hence not that attractive.
3. Projected royalty payments are very low, so not worth acquisition.
Well with no:1, we don't officially know as its being withheld.
No:2 Todays RNS says mainstream, but wont be the first time an RNS has over egged its projections. Only Croda know this for sure.
No:3- Actual royalties are very poor...This is my main concern as I do not trust SA, however others I do trust say they are very good.
Our diversification could be sold off reducing offsetting cost to Croda, so I look at that as a positive.
Also having a trusted although retired employee on our board does give them the inside track. Know a few examples where retired employees especially on the board still fed info back to old company. Indeed most professional workplaces require employees to state whether they still hold or have held executive positions or a stakeholder. I know I had to do similar.
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