The latest Investing Matters Podcast episode featuring Jeremy Skillington, CEO of Poolbeg Pharma has just been released. Listen here.
Out of interest, did Stella jump ship before or after it was decided that directors wouldn't be getting more share options?
To be fair to her, she did acquire some shares around the same time, so must presumably have faith in the business.
Would it be feasible for the company to just sell its assets as they stand?
Presumably there is some easily realisable value in the biobank and some of the fixed assets and, if (!) they could be sold at fair market value, the company's interests in 201, 301, CLX, etc could hopefully provide some sort of cash to the shareholders.
In essence, if 201 doesn't complete (and assuming that means Suzy goes), could a newly appointed CEO realise substantially more then the current £6.3m market cap for flogging off the family silver?
I'm still hopeful on 201. We should know definitively what the TRx-EUDA outcome looks like in a bit over seven weeks... at which point the shareholders will need to make an informed decision about what comes next, i.e. (i) divest; (ii) change Board; or (iii) continue with the status quo. There's probably a fourth and fifth etc option but you get the picture.
Still not clear what the options are, though. If no 201 monies by end of March, the shareholders will be rightly annoyed and I can't see Suzy surviving. In that circumstance, what do you think the new CEO should do? Lab isn't generating cash quickly enough to sustain the business, but terminating the lab would be even more wasteful. We have legacy assets such as 201 which nobody seems particularly interested in. And the investment in identifying new products requires cash which us shareholders need to stump up.
Not sure where we go.
Suzy must really believe that the TRx merger will soon complete and 201 monies then received, otherwise her spending plans do not make any sense. That said, if 201 monies are not received by 31 March, she surely can't stay in post - she has had some time now to implement the TCRO strategy (but it still appears to be a cash negative offering without any immediate promise) and all the rest of the potential value lies in legacy assets. Question is, what are the options for the business is Suzy goes?
I know a lot of shareholders see Adam's appointment to the board as a panacea, but in reality he is (was?) fully bought into the TCRO strategy and i'm not sure what alternative direction he would provide.
Which leaves... carrying on doing more of the same (which frankly might as well have Suzy in charge) or... liquidating the assets?
I don't know. Where do we really go next?
Wasn’t it Adam pushing for Valirx to be a TCRO to begin with? Success in this field will take time. I can’t imagine that he would bother with all the shareholder aggro for… what? Nothing in it for him and I’m guessing he has no desire to sit on the board.
That's really insightful, thanks Badsterman. Quite expensive financing, given the loan notes convert at $1 per share (compared to $1.61 overnight). I assume the cash is required to keep the deal advisers on board. Interesting that there's two dates of 31 January and 31 March - I assume the idea is that they get the TRx deal done (and cash flows in) by 31 January, but if it doesn't, more will be lent to EUDA to keep the deal advisers going.
Not been any comment from Adam in a while. Any idea where he’s got to?
It’s not in her hands. The deal will (or won’t) be done whenever it is. Bigger point is whether BOD should retain their positions when it next comes up for a vote.
If no cash coming in by AGM then the BOD really will need to go.
Fair enough porky, although I struggle to see what EUDA gets out of this if TRx aren’t bringing investment cash to the table. My positive mental attitude is still winning through anyway
Whilst I'm at risk of being the odd man out (and potentially completely wrong in terms of conclusion here), it's worth noting that there has still been no update from EUDA to the NYSE, which surely has to be a good sign. As with the UK stock market, there's a requirement for any material news to be provided to the US market ASAP where it could have a material impact on price. No news is... annoying but potentially good. If we get a positive announcement from EUDA, I can imagine us shooting up to 20p+ per share very rapidly (whether sustainable or not).
Valipharma is wholly owned by Valirx.
Inevitably, Valirx paid costs on behalf of Valipharma which it wasn't reimbursed for, and this created an intercompany receivable. As Valirx has both the payable (indirectly) and receivable (directly), it cancels out, i.e. it's irrelevant to the company's financial position.
It’s interesting that there have been no updates from EUDA despite exclusivity having passed, but no news implies that negotiations are ongoing.
That said, I’m struggling with timeline now. I had assumed that this was in essence a reverse takeover – i.e. the TheoremRx shareholders would in effect be issued EUDA shares in return for their shares in TheoremRx, and the TheoremRx shareholders would control EUDA after the transaction.
However, if correct, I think (!) from looking at the literature that this would need shareholder approval and that would require notice of at least 30 days under the NYSE listing rules.
So…
Afraid to say it, but given the lack of notice to date, my reading is that this is going to drag well into January before the deal completes and any money flows.
That said, clearly positive news from EUDA would be good for Val’s share price in the meantime. Hopefully it will give some indication of how much TRx is valued at too, so we can get a feel for what it’s got (in terms of cash, pipeline, etc).
Delays are frustrating, yes. But Suzy’s moving the company forward and her salary is hardly astronomical. If Suzy pulls off a deal and gets the share price significantly up, it will all have been worth it for all of us investors. Not long til news, positive or negative
Given US markets shut today and half day tomorrow, I assume that means no news expected this week
1pm tomorrow, I’m at least 20% sure we will have some great news. Whoooooooooop
I’m shooting for deal signed over the weekend, news released at 1pm UK time (8am EST) on Merger Monday
The parties will have an awful lot to get done to get this across the line… due diligence, structuring, SPA and commercial agreements… 30 days was always going to be tough. They may not even sign within the exclusivity period if there are still items to nail down. Importantly, we have had no indication that this isn’t going ahead. Be chill people, news will come!
If i've understood EUDA's problem correctly, its issue is that its share price and market cap are (or were until very recently) too low, so that it risked being automatically delisted. The proposed transaction is likely to be a reverse takeover, whereby the shareholders of TRx are issued with shares in EUDA in return for their shares in TRx.
This would only sort out the share price/MCap issue for EUDA if TRx is bringing tangible value to the table - obviously, given that new shares will need to be issued to TRx, which would otherwise dilute the share price. That value can only be in the form of ££££ cash.
So, I think it's pretty clear that TRx either has cash, or has committed funds.
It's not unreasonable to assume that the TRx funders will only permit the various payments TRx is on the hook for (including in relation to Val) to be made when they know they have a way of extracting their cash. Which would clearly be through them getting shares in a listed business.
Simples.
Fair enough. In any event, we are aligned in being super keen for positive news on EUDA. Really do hope we receive an update soon, I was surprised there wasn’t an announcement once the 30 days were up. I would imagine they have to issue something tomorrow.