Member Info for cf456

- Multiple institutions loading up at current prices.
- Multiple licencing deals expected in the near term.
- Consolidation in the sector.
- Potential takeover target.
- Fully cashed up until 2020 so no placing required.
- Broker target of 120p (vs mid of 30p so a huge 4x current price to Finncap target).

https://realmoney.thestreet.com/investing/jim-cramer-the-long-awaited-drug-company-consolidation-has-begun-14824254

https://www.ft.com/content/d78fe796-0f70-11e9-a3aa-118c761d2745

"In this respect it is also worth mentioning Ablynx’s US$4.8bn takeover by Sanofi in January 2018. The valuation of Ablynx, the leading non-antibody therapeutic platform, at the time of the deal reflected, of course, the fact that their lead drug was already under regulatory review, but a large portion of it was in our view related to the value attributed to their rich pipeline and their platform technology called Nanobodies. It is well known that Novo Nordisk was also looking at Ablynx and therefore it is likely that they continue to have interest in an alternative therapeutic platform like Avacta’s Affimer."

https://www.capitalnetwork.com/companies/research/110626/avacta-group-maximising-affimer-s-potential-across-therapeutics-and-diagnostic-applications-110626.html

AVCT a potential takeover target.

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Celgene deal a ‘catalyst’ for pharma takeovers - https://www.ft.com/content/d78fe796-0f70-11e9-a3aa-118c761d2745

https://realmoney.thestreet.com/investing/jim-cramer-the-long-awaited-drug-company-consolidation-has-begun-14824254

A bid got to be an increasing possibility whilst the shares remain so cheap and larger players have the opportunity to buy the assets at a bargain basement price.

"The cheapest thing we could buy in the North Sea right now is ourselves."

https://www.malcysblog.com/2018/12/core-finance-interview-andrew-austin-of-rockrose-energy/ (from 6:38)

"An update from RRE this morning which confirms many of the things that Chairman Andrew Austin and I spoke about at our recent interview. Production in December reached 11,200 b/d and guidance for this year is 10-12/- b/d. Cash is very strong at $121.4m of which only $53.8m is in DSA’s. With the company throwing of cash and increasing their chances of more deals the outlook is bright, with the Arran deal shoring up the medium to long term for RRE opportunities are significant. If you missed the interview it can be seen here."

https://www.malcysblog.com/2019/01/oil-price-amerisur

A real potential turning point for the company here as the solid work done to date begins to bear fruit.

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"We've built a substantial pipeline of evaluations like this over the last 18 months or so, and this I hope is the beginning of a number of these deals being done."

http://goo.gl/3KxoBW

From 2:37

Clearly the instis are aware of the potential and buying in before further licencing news drives the price much higher.

Lombard Odier - up to 6.43% from 4.63%.
JO Hambro - up to 10.91% from 5.03%
Mole Valley - up to 3.01%

A number of further licencing deals in the near term likely. The cumulative size of these could dwarf the current market cap.

Capital Network - "The Affimer reagents business is being built around external technology evaluations, of which many are in progress, and an internal pipeline of assays readily available for license. From this basis, we expect Avacta to announce multiple royalty-bearing deals over the coming months."

FinnCap - "We expect this to be the first of many licences, the value of which should increase as data packages build further." ... "With a rich pipeline of interest in the reagent portfolio and ongoing discussions with other pharma companies, we expect further licensing activity."

Hardman - "[LG Chem] is an excellent and valuable partner for AVCT, and likely paves the way to further major deals."

http://goo.gl/pqCvNH

https://investegate.co.uk/avacta-group-plc--avct-/rns/holding-s--in-company/201812191532530244L

"The market capitalisation of those comparable companies, around $300 or $400 million dollars gives you a good benchmark of where Avacta could be in 2 to 3 years time."

"This means that for an investor that is already confident about the strong scientific rationale behind the Affimer technology and the pre-clinical evidence that has been produced so far, this could be a very attractive entry point because Avacta currently has a market cap around $30 / $35 million dollars so the upside is clearly significant."

http://goo.gl/X9Ydbx

From 4:51

A significant breakout on the chart above 0.8p.

Looks like it could head up to prior highs from here pretty sharpish.

https://twitter.com/Roofershound/status/1073537998376046593

https://twitter.com/chrisoil/status/1073152742871494656

"AVCT has just concluded an Affimer therapeutics development and commercial agreement with the global pharma company, LG Chem, worth up to $310m in upfront and milestone payments. This represents a huge endorsement of the Affimer platform."

"The rising number of collaboration deals being discussed and signed is a clear indication of the long-term value of its Affimer technology, which the market is currently only just beginning to recognise."

"in the context of this deal, the current value represents an enormous opportunity that the market is totally overlooking. This deal looks set to be a wake-up call for the market."

https://www.avacta.com/sites/life_sciences/files/resource/Hardman%20AVCT-LGC-deal-10-December-2018-1.pdf

FinnCap
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"With a rich pipeline of interest in the reagent portfolio and ongoing discussions with other pharma companies, we expect further licensing activity. We estimate the risk-adjusted NPV of this deal, based only on the potential milestones to be worth 12-17p. We retain a target price of 120p."

"Avacta has a market cap of £26m and an EV of £21m. The most relevant comparator companies are Pieris and Molecular Partners, which are valued at £141m and £284m, respectively.

Whilst both of these companies’ technology platforms are more advanced than Avacta’s (in human clinical trials), Pieris having products in Phase I trials and having demonstrated safety in humans, the potential uplift for Avacta is clearly very significant as it meets this milestone in the next two years."

"With probably close to 50 companies that have or are undertaking evaluations we expect further licence deals to be announced in 2018 and onwards, all of which should generate incremental value."

"We retain a target EV of £125m, which implies a share price of 120p. The risk-reward profile at this level is materially skewed to the upside in our opinion."

https://www.avacta.com/sites/life_sciences/files/resource/Avacta%20Research%20Update%2010%20December%202018.pdf

"INFA announced this morning that it has completed its final milestone for the FEED for the Islandmagee project and that the report has been sent to the EU for grant purposes and they should receive payment in Q2 2019 post verification. The company is now in a position to concentrate on completing negotiations with the three potential equity providers which is now at term sheet stage.

The speed with which Ifrastrata has processed stuff in the last few months has been highly impressive, this could now really be a runner..."

https://www.malcysblog.com/2018/12/faroe-eco-atlantic-infrastrata/

The shareholder meeting tomorrow could drum up some buying interest.

https://twitter.com/JohnWoo64494325/status/1069643087620775941

Always the possibility of a positive RNS tomorrow morning as well prior to the meeting.

Just been tipped

https://www.investorschronicle.co.uk/comment/2018/11/28/a-bargain-basement-value-opportunity/