All Rodez lead to?26 Nov 2020 17:45
I think conversations about a potential TO need to be mindful about the current share ownership but also the wider play here. I still am of a mind that the game play here is more akin to that summarised by @pacman. However it is noticeable that there are some large trades that are balancing about the wider sales of the smaller PIs (unfortunately).
To be honest with 720,509,950 shares in issue, if there was a TO in the offing (much as any LTH would wish) there would need to be far more and with this leaky BoD you would expect it. It also should be noted that just the 4 individuals below own 39.7% shares.
- Dr Bill Chang: 11.1%
- BGF: 9.2%
- Mr Steven Myers: 8.4%
- Life Technologies Ltd: 5.7%
- TB Amati Investment Funds Ltd: 5.3%
So with the other shares owned by the BoD and insiders the BoD could easily get the approval without PIs. YourGene Health's last reincarnation Premaitha was designed for a TO and the NIPT product was central to entice a bid from Thermo Fisher to enhance their sequencer sales. Similar to an App on a mobile phone. With arguably the best CE-IVD NIPT on the market (for both Illumina and Thermo Fisher sequencers) I would argue that YGEN are even more attractive, not withstanding now having DPYD, COVID (2-gene) testing and the other add-ons via acquisition. In most ways it is surprising an offer has not come yet, despite not having achieved break-even, than it will come. So will a TO come, yes, however the BoD seem content to allow the number of shares to increase through options, acquisition to then accept a lower offer down the line. Good for some PIs who are happy to have this as a pension stock which they top up each year to accompany each dilution. However it does leave other PIs, especially LTHs, scratching their head.
When the TO comes, aside from the inevitable leaking to insiders and also by those financial intermediaries arranging the sale it would be quite quick. The share ownership above does not reflect that which is under options.
So in summary:
Dr Bill Chang holds options over 300,000 new ordinary shares, exercisable at 10.0p, and options over 400,000 new ordinary shares, exercisable at 7.75p, and options over 400,000 new ordinary shares, exercisable at 10.25p.
Life Technologies Limited holds warrants over 20,325,204 new ordinary shares exercisable at 24.6p, warrants over 17,094,018 new ordinary shares exercisable at 11.7p, and warrants over 16,913,319 new ordinary shares exercisable at 11.8p. Life Technologies Limited holds 41,356,165 ordinary shares which are subject to a lock-in deed until 17 February 2022.
Dr Bill Chang has also transferred some of his shares to his wife, as has Adam Reynolds. So the (10-person!) BoD could quite easily call a quick EGM or quorum and agree a quick sale. I would suspect however that Dr Bill Chang would exercise his options before a potential TO, but then again perhaps at the same time. He did take on the role of Chief Entrepreneur which was a bit Mon
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